All Forum Posts by: John Nachtigall

Consider syndication.   They are 100% passive.    The downside is that you don't have the control.   Check our CrowdStreet or RealCrowd to see what they look like and what they offer.   

Perhaps it is a step too far, you seem to want to stay with direct ownership, but I thought you might want to consider it.  

 The math is not right.   A 401k grows tax free.   So even if you pay tax in the end, during the next 30 years you get the investment return on the whole sum, not subtracting 25% in taxes each year.   

And you dont get a company match on the withdrawl.   

And an s&P 500 fund does not require capital reserves

It is your money, do what you want, but the math is clear.   401k wins

 There are 74 million children (under 18) in the US.  There are ~550,000 homeless.  So obviously 1 in 10 are not homeless.  Even if it is 18-24 (young adults) that makes no sense This is just a definition used by advocates to try and inflate the issue.  When they say “experience homelessness” your mind goes to them being homeless.   But they are using degrees of separation to try and inflate the issue.  1 in 10 know someone who was homeless or has met someone who is homeless.   That is a totally separate thing. 

I understand they want to be an advocate, but they are misleading people. In actuality, like crime, homelessness is actually dropping over a long term trend.  

https://www.hud.gov/press/pres...

You have to believe that being "Individual 1" and "Company 1" in a federal indictment can never turn out to be a good thing, Clayton has problems.   I know he is convinced of his innocence, but he needs to read up on the "prisoner's dilemma" game theory.   For motivated self-interest it is always better to rat out the other defendant first.  The question is do the feds need him to get Burt, or are they thinking that they will use Burt to get Clayton....

https://www.investopedia.com/terms/p/prisoners-dilemma.asp

All of this misses the point.  This is a fundamental misunderstanding of math.    This is not a crisis, this is a normal bell curve distribution.  

There are approximately 550,000 homeless (un-sheltered) people living in the United States on any given day. The US population is ~330 million.   That is a ratio of 0.17%.    Sort the link below by homeless ratio.  That is less per capita than France, Germany, UK or Sweden.   

https://en.wikipedia.org/wiki/List_of_countries_by_homeless_population

The USA successfully shelters 99.8% of the population.   I simply argue that 100% is not an attainable goal, given the restrictions.   And those restrictions are not money

-  The US Constitution gives people the right to not be imprisoned or forced to do anything against their will because they are mentally ill as long as they are not a danger to themselves or others.   

-  Similarly, no citizen can be forced to seek treatment for drugs or alcohol against their will.   While they can be arrested and imprisoned, they can not be forced to "get better".  The state can not choose "what is good for you" they can only punish.  

- Some small portion of the population prefers to live un-encumbered from the rules and procedures of everyday life or believes that stable housing is not worth the cost.  

Those are all very small populations, but we are talking about a small problem only affecting 0.17%.   Simply put, if you are going to allow for the freedom that the US Constitution gives, you have to accept that some portion of the population will use that freedom to live in a manner that prevents them from being sheltered, either voluntarily or as a result of decisions freely made. 

The press can magnify the problem with a lot of stories, but in the end, this is just a math issue.   There will always be a bottom of the bell curve and that can not be avoided.  

 Sue the bank to modify what loan?   Once the loan is called there is no loan  to modify.      And the modification cant be given unless the owner of the property signs the new modification.  You say the modification could not be stopped, but your actions would have stopped it had the bank known.    I doubt you would have followed through, but I will give you that assumption, your own words prove my poin

Per your own explanation.  Neither you or your client told the bank the seller no longer owned the assett before you got the loan modification   Your entire strategy rested on the assumption that you could fool the bank.  Hence your 1% chance, it is 1% because your seller would not tell and I am betting you didn’t file your deed prior to the modification.    no way for the bank to know and the seller did not correct the paperwork after the material change.   That is slimy, perhaps legal, but for sure slimy.   It is wrong to mislead people or organizations, even with lies of omission.  

Thanks for helping to prove my point 

I understand this is a political "wish list" if you will.   So I can understand something unrealistic like calls for rent control despite the overwhelming evidence it does not work.   It is the "candy bar" of public policy, it is easy to sell but only makes the problem worse.   It has a short term help and a long term loss.   In a political campaign you only care about the selling not the effectivity and you care about the short term.   That makes sense.

But some of these things are just beyond the pale.   Government owned housing projects were an abject failure that exposed thousands of poor but otherwise honorable citizens to literal imprisonment but without the guards for protection.   They were torn down by a Democratic President (Clinton) because they were so bad.  Even today they are failures.   

The New York City Housing Authority (NYCHA) is the largest public housing authority in North America.  It has 400,000 residents and is considered the "most successful" authority in the country.   It pled guilty to a federal lawsuit where they admitted to training maintenance workers to hid problems.  Things like exposing thousands of children to lead paint, turning off the water to hide leaks and building false walls to hide the holes.  Remember this is the "best" authority in the country.

https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-settlement-nycha-and-nyc-fundamentally-reform-nycha

And even now, they stink.  They can't even provide heat to the tenets

https://gothamist.com/news/more-10000-nycha-tenants-go-without-heat-hot-water-largest-single-day-outage-season

So I don't understand how anyone who wants to help the poor would propose more of this?    Add 500 million to section 8 housing vouchers would make way more sense.    But public housing has been a bane to the very people you hope to help and even today the "best" example is terrible.  

I just don't get it.  

You have to believe that Bert Whalen is going to sing like a bird.   Given the number of victims and the revised sentencing guidelines for white collar crime at the federal level this is not going to end well for him.   His only chance to mitigate it is to turn on everyone, at the only person worth prosecuting (other than him) is Morris.  So I think Clayton is a given, the only question in my mind is how deep Natalie is in this.   Per the podcasts and such she keeps the books, so does she get swept up also?

This forum is not to be used for politics.   However this proposed plan is squarely about landlords and renters.   So without saying anything about the candidate I thought we could discuss the plan and some of the more interesting aspects.   Some of it is pretty standard (rent control, lawyers for tenets, etc.) but some of it is even beyond that.  

https://elizabethwarren.com/plans/protecting-empowering-renters

-  First thing is I thought it was very interesting that it is a renters plan in the first place.   It shows how the country is moving towards renting rather than promoting home ownership.   

- it will "entice" the states and localities to accept these laws by offering 500 billion in affordable housing funds.   The US spends about 6.4 billion a year in residential construction housing, so a one time 500 billion injection would be off the scale.   No realistic way to even spend it if it happened as there would not be enough construction workers to even hire.  

- One of the proposals is a new national Tenet Protection Bureau which will "enforce tenants’ rights, take on bad actors, and make sure landlords keep affordable housing affordable for working families".   I am pretty sure she means most all the members of BiggerPockets.  

- another interesting point is redlining.    Something like @James Wise Ultimate Guide to Grading Cleveland Neighborhoods would be illegal under her plan.   Any housing policy with "racist effects" would have to be ended.   So the identification of class A, B, C, and D neighborhoods, even with the intention to invest in them, could be racist.  I know this sounds crazy, it is an amazing piece of logic but the argument would be that investing in class C properties causes gentrification which pushes people of color out which is racist.   I have no idea how you would prove any of that in order to prosecute it, but that is in her plan.  

-  Homelessness...I will just quote this part as I can't do it justice   "My Department of Justice will not fund efforts to criminalize homelessness and will deny grant money to police departments who are arresting residents for living outside."  Feel free to look at how that has gone for San Francisco

- There is a provision to deny mortgages to "large predatory landlords" by locking them out of Fannie Mae and Freddie Mac.  Again not sure how that would work.  

- It eliminates rent to own, she calls them land contracts.

- It will require the publishing of individuals names in LLCs

So I am unsure if this is too "political" to discuss on the forums but I thought it contained some very interesting and different plans with respect to renters and landlords and worth the try.   

Again, this is not about the politics but the proposed policy.   I am interested if you found other parts interesting, it is a very large plan.  

You were going to sue the bank because they would not modify a loan on an asset that the borrower no longer owned.....Yes, since you asked, I am calling that slimy.   Lets break this down....

-  The loan modification was not "legally obligated" because had you been honest with the bank you would have told them you had triggered the "due on sale" cause.   So they could have legally called the loan at any time.   So any court case goes nowhere because there is no loan, it is replaced by a call on the loan due to sale.

-  You have no standing in court anyway because as explained you have no legal obligation and are therefore not a party to the loan.  So you can't appear in court.  

- lets assume you got a judge that ignored all that, you expect a court to order a bank to modify a loan to a borrower that does not own the asset?    Good luck with that.   That is not law, that is your fantasy.  

- Lets talk about that modification paperwork...does it assert that your buyer is the owner of the property?   Did they just commit bank fraud by signing something that is not true?

- Side note, that "forgiven" loan value is actually counted by the IRS as income and when you don't own the house you are required to pay taxes.   I am sure you seller paid taxes on that $200k.

Feel free to call me a liar, but if the bank had called the loan, given there was no equity, you would have walked away free and clear and the seller would have lost it all and took the full brunt.  You think it is "problem solving" and the big bad bank should just accept their money and be happy.   The truth is that you mislead a bank to write off 200k of value so you could pocket 100k.   If anything had gone wrong you would have walked away free of obligation.   I think it is fair to say you (perhaps not the seller) did not do anything illegal, but it was slimy.