All Forum Posts by: Jason Zundel

Joseph, this depends a little bit on the original terms and language from the note/loan agreement between you and the LLC. It is important to treat it like a fully third-party transaction, but should the terms allow the easiest solution is to create a loan addendum or amendment allowing for interest only payments on the terms of the loan. Personally, as you are the responsible party on both sides of the transaction, I wouldn't put a specific end date either for more flexibility. Simply allow for interest only payments until the property is refinanced.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

@Ray Heraldo - You are right on both points - having the properties in the trust now is a GREAT idea, but there will be an expense and hassle each time you transfer the properties.  My general recommendation is to look at the timeline:  If you will move forward with LLCs in less than a year, then it's not worth moving properties to the trust and then out to the LLCs.  If it could be a year or longer before the LLCs are set up and ready to go (of if you go the route of a large umbrella policy and won't use LLCs), then it's worth it now to move the properties to your living trust directly.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Happy to help and welcome to the Bigger Pockets family!

Hey Anthony, you are correct (under rule 462.040 in CA) that so long as the original transferors stay on title with the same percentage ownerships, then converting from joint tenancy to a tenancy in common will not be considered a taxable transfer.  CA being CA though, the slightest mistake will cause you problems, now or later on down the line.  Unless you are pretty comfortable with filing forms of this nature, I might recommend getting some help.  Doesn't have to be an attorney though, as a good title company could likely help you with this for much cheaper than a real estate attorney in CA.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Ray, lots of really great information on this chain! Love BP for this. Agree and love the input from Katie about CA and the fact that LLCs will stop the liability from attaching to other assets/individuals separate from the LLC, but not against the home or property itself that is subject to the liability. I did want to address one very common misconception - SMLLC (single member LLC) treatment is a state by state issue and most of them actually stand up to scrutiny quite well. WY for example has statutes that specifically address SMLLCs as having the same treatment and protection. FL, on the other hand, has jurisprudence calling into question the strength and validity of a SMLLC, so be careful there. Best of luck making final decisions!

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

This is not uncommon when the rates are increasing and more variability in the market.  The yields overall often tend to be lower though as there is more risk involved with seller financed deals than traditional deals in my experience.  That being said, there are great opportunities in this area so long as due diligence is careful and thorough.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Certainly a bit biased here, but we would strongly recommend setting up LLCs for the properties, and ideally pairing them with a holding company in WY, DE, or NV to fully separate the risks and liabilities of each of the properties from your own personal liability, and vice versa. Your best protection will come by having each property in it's own LLC as well, though at minimum one per state. The goal of insurance is to accept your money and not make any payments out, whereas a structure of LLCs is designed and owned 100% by you and for your protection. FL and CA are each a bit of a unique scenario as well, so if you want to reach out directly, I'm happy to talk one-on-one about the details.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Unsurprising to hear an attorney give recommendations for attorneys, but to be fair - it's not an area my firm practices, so that's something!  Especially with evictions though, you want to be very careful.  Local, in person experts are really your safest bet, most especially attorneys.  Unfortunately, I don't have a specific recommendation for you in Fort Worth, but should you not get one from someone you trust here, I do have two resources I regularly recommend to clients - the Texas State Bar website and Martindale.com.  Both will have details on practice area, niche specialties, history, etc. and can help with the vetting/decision making process.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Those three are the broad areas, but my recommendations would be the depth of digging in those three areas.  Don't just look at the market value of the collateral, but the title history to make sure there aren't any clouds on title or other landmines waiting should you need to collect against it.  Your borrower profile should include credit score, yes, but also their education, employment, and (where possible) history of obtaining other loans.  Of course, the larger or smaller the loan involved, the more flexibility or depth of analysis should take place based on your risk aversion.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Oof, this is a tough one. If the HOA aspects are truly as your describe, why not a third option - take that loss budget and put it towards an attorney to hold them accountable? To be clear, my firm does not practice in this area of law, but for a few thousand you could at minimum ensure that the budget doesn't go up, and if your attorney finds true malfeasance, you could find a windfall and turn the area around. Especially if you are planning on leaving, and willing to leave at a loss, it's not like you will be burning bridges here.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.