All Forum Posts by: Kyle Meyers

Steve,

Thank you for clarifying. I was trying to say once you possess the deed, it would have been better phrased as once you have ownership.

I didn't have strict criteria last year. It was the first year I bought any liens and I just wanted to buy a few cheap ones to learn the process. All 3 were under $1000 each and had decent homes which I figured I could make into rentals. Two were abandoned, 1 was still occupied, but appears to be abandoned now.

I bought some more liens this year with a higher max bid and stricter criteria. I look for properties I could easily turn into a rental and get a desired return on if I get the deed. I actually started looking for occupied homes because I believe there is more likelihood they will not have had all the wiring, pipes, and furnace stolen out of them. If I get possession next year of any of the ones I bought this year, I plan to inspect the properties and then allow the current occupants to apply to rent it from me if the property is in good condition and the occupants seem reasonable. Otherwise it will be cash for keys or eviction.

George,

I bought 3 liens in 2010, none of them redeemed. I am about to get the deeds for 2 and I am walking away from the other one because it burned down.

Are there other 3 bed 1 bath properties nearby? What do they rent/sell for? I think the functional obsolescence is not certain, I have a duplex with 3 bed 1 bath units and it rented just fine. Buyers and renters may prefer an additional bath, but may not be willing to pay enough more for it to make it a good investment on your part.

I would capitalize all of them under most circumstances.

As Jon said, you cannot cut off power, water, gas, or change the locks. That would be a constructive or self help eviction and it is illegal.

Do a search on these forums to learn about cash for keys. You can offer them some money to move out. Otherwise, you just wait for the legal process to work this out and evict after the 45 days.

Do you have an attorney? They may be able to help you find if there are any ways you can legally speed up the process, but there is probably not much you can do.

As long as the basis for your buildings total up the same, the depreciation would be the same.

I made a spreadsheet real quick to give an idea of the benefits. Hopefully it shows the differences well.

I'm trying to attach it to this post, but I'm not sure if that is working. I uploaded it to the fileplace too.

Check the intestate laws in your state. I took a quick look and I think the property would go to Mr. XYZ's siblings. You could contact them about purchasing the property. As Sharad suggested, you could also look into buying it through a tax sale.

Depreciation would be the same (assuming the same basis), but if the rents are less on the 100k than the total of the 25k homes, there would be less taxable income. If the more expensive home increases in value over the next several years to make it as good (or better) of an investment in terms of overall return, the gains from the sale would be capital gains and taxed at a lower rate. More of the overall return from the 100k home would be taxed at a lower rate than the 4 25k homes, which would boost the after tax returns.