All Forum Posts by: Matt Vaughn

Good point. So I get that it's going to be considered a gift now - my only curiosity is why it's considered a gift when he is getting 50% of the property in return? I don't really care what they call in my particular situation, but going forward, when I do a deal with you, for example, if I provided the funds and you found the deal, and we split it 50/50, would my cash be considered a gift?

@Dion DePaoli , the intent is for this property to be fixed and occupied by my wife and me. My father intends to invest 50% of the price in exchange for 50% equity in the property. I intend to secure a loan for the other 50%. There is no expectation that these funds would be paid back, except upon sale of the property, at which time he would have a 50% stake in the equity.

Good info. So can I get his name on the title at 50% owner without having his name on the loan? He has already chipped in his 50%, so he shouldn't have to bear the risk of co-signing my loan.

I had heard that this could all be clarified in a well-written and jointly signed operating agreement, but I guess not?

So I need some help - I'm new to this.

I just put an offer on a deal in Maryland that I'm pursuing with a family member (my sister calls him Dad). The plan is to split ownership 50/50. He's providing $100k in cash and I'm planning to finance the remaining $100k through a conventional 30-year fixed mortgage. He said he didn't need his name on the deed - we planned to write up an operating agreement to clearly define our business agreement, but we didn't think it was necessary to add multiple people to the deed.

At the last hour, I'm hearing that my dad's $100k is going to be considered a "gift" and that a "gift letter" will likely be required. Does this sound right? Would this be viewed differently if he were on the deed?

We didn't consider this a gift - we considered this a 50/50 purchase, where he funded his half with cash and I'm funding mine with traditional financing.

The only reason I care about the "gift" terminology is if this adversely affects my dad from a tax perspective.

As it stands, I have an offer going in with my name only on the offer, and claiming a 50% downpayment that I intend to make with my father's funds (not sure if it's relevant, but I have plenty of cash and income to qualify for the whole loan independent of my dad's downpayment).

Does anyone have any insight or recommendations?

For all I know, there are a million better ways to structure this.

@Bryan Hancock , could you explain this a little bit more? I'm not sure if I'm understanding.

Here's a question for you guys:

What are ways that you gain reasonable assurance that you'll be able to build on a plot of land before purchasing the land?

I'm looking at several properties, some of which are bare land, others of which have a single house on a larger plot that I'd like to subdivide and build on the new plot.

Because development will be contingent on multiple permits and/or subdivisions being approved by the local jurisdiction, how can you make sure you don't buy the land and then end up with land you can't build on?

Great insights, @Robert Williams , @Roger Lin , and @Steve H.! This helps me understand the market better. My market is pretty broad right now: Calvert County, Annapolis, Laurel, and Frederick are the areas of interest for me.

Roger, you recommended getting to know many agents. I'm under contract with my agent until early summer (Remax 100). It was my understanding that I couldn't work with multiple agents at a time. Is that wrong?

Rob, thanks for the suggestions about accessory apartments. In the two counties I've checked (Calvert County and Montgomery County), they claim that I can't rent both units once I've left. Does anyone else have experience with this (including if this rule is or needs to be followed).

So what does a guy have to do to find a duplex around Washington D.C. these days? I'm looking for our first home, which I'm also intending to be our first investment property. While my first preference would be a duplex (so I can learn how to landlord), I hardly find 5 duplexes on the MLS in the entire DC, Maryland, Virginia area (excluding SE D.C.).

Are duplexes not usually listed on the MLS? Are there better ways to find them? Once in a while I see a SFH with an accessory basement apartment, but I understand that I'm not supposed to rent both units if I'm no longer an occupant. Is that rule enforced?

Interested in your thoughts.

So what does a guy have to do to find a duplex around Washington D.C. these days? I'm looking for our first home, which I'm also intending to be our first investment property. While my first preference would be a duplex (so I can learn how to landlord), I hardly find 5 duplexes on the MLS in the entire DC, Maryland, Virginia area (excluding SE D.C.).

Are duplexes not usually listed on the MLS? Are there better ways to find them? Once in a while I see a SFH with an accessory basement apartment, but I understand that I'm not supposed to rent both units if I'm no longer an occupant. Is that rule enforced?

Interested in your thoughts.

@Gary Threadgill , I'd recommend you listen to podcast #54 where @lisa Phillips tells her low budget, bad credit story. She also lives in the DC Metro area but invests in Baltimore.

I'd definitely recommend you get into the podcasts, the forums, and the free resources on this website, especially the ultimate beginners guide. There's a ton to learn and many unique strategies that work for investors at all price points.