All Forum Posts by: Justin Summers

 Mother bought the house and the loan is in prior owner's name.. Mother pays mortgage payment to bank monthly.  The 1098 is sent from bank in prior owner's name. Are you saying prior owners should issue mother a 1098? 

 Bigger pockets is my tax advisor!  People here know more than most accountants I've encountered..

So, my mother bought 2 properties land installment about 10 years ago. The title is in her name but the loan is in the prior owner's name. The bank sends the 1098-int for yearly interest paid to the Prior owners and then my Mother deducts that amount on her Schedule E but doing it this way could throw a flag up with the IRS computers since there is not 1098-int in her name (Even though she is paying the payment to the bank each month)    This hasn't been problem in the past but I'm worried about the future with her claiming the mortgage interest without a 1098.. Can the prior owner nominate my mother as the payor of the interest? or issue another 1098 to my mother? How would this a handled on their tax return? 

Thanks for any input

6% is not nearly enough return to tie up $100k. so, no. Not without a substantial discount.

Just to add here.. Lately I have been seeing Municipalities in NE PA really go after all the excess proceeds.. One claimed $100 per day fine from not cutting grass for 2 years to take the $70k excess proceeds.

 You are describing communism.  This is not what America was built on.. Nor should it be where America is headed.

Clearing it with the state means they will only do it if the state signs off they release the lein.. They won't ..   I strongly suggestion going with Tax Title services.   It's like $900 for them to do all the research and give you a decision within 45 days.. Well worth the money.

 Patrick- Thanks for your feedback and wealth of information. 

Thanks Ty- Submitted a call in your schedule for 3:45 today or feel free to call earlier if you are free.

I am looking to get a HELOC on my primary residence. The line will be over $500k so most banks process it similar to a regular home loan. It's been about 20 years since I have gotten a mortgage since I usually pay cash. I have rental income and have 30 paid off properties.. I buy 5-8 new properties per year and sell 2-3 of my rentals per year for income.. Since this is capital gains income I know it's looked at differently. I heard the banks and also Fannie may now allow capital gains income to be included as qualifying income for getting a loan. I have been told average of the last 3 years returns if it's consistent they will use it. I have a few questions.

1. Will underwriters use Year to date Capitola gain sales into that average? Or are they allowed to do this under Fannie Mae? or just filed tax returns capital gains for the average? 

2. Will an underwrite add a property sale into the average that was sold and reinvested in a 1031 exchange?  for example if I bought a property in 2019 and sold it in 2023 for $100k capital gains profit but reinvested in another rental through a 1031 and didn't pay taxes on it in 2023? Would they still add that to the average capital gains? 

Most loan officers don't know these questions so I'm hoping there are a few underwriters here or more knowledgeable loan officers.

Thanks

Justin