All Forum Posts by: Vincent Incopero

@Xavier Alicea In addition to all of the information that has already been provided regarding the risks of the area, I suggest you start networking to find a willing and skilled Property Management Company who has deep/extensive roots in the area and who is already managing a significant base of performing doors. In doing so, you might learn more about the area, the attendant risks and the actual ROI of these higher risk doors and more about the headaches associated with ownership. Sometimes you can find a diamond in the rough, however most of the time you will find that the precautions of others are worth following.

@Kevin Yun, I suggest that you reach out to @Mark Ainley with GC Realty and Development. Mark is an active contributor to the BP community, locally and at large.

GC Realty and Development manage and have a brokerage arm so that they are truly full service boots on the ground. 

@Jay Miller I think that the more logical starting block is getting hooked with a lender that TRULY understands the process. Many say they do, most don't. Ask them how many they have done in the last 12 months. If they cant say more than 4, keep it moving and find a new lender. There are an additional 10+ steps in the process when compared to a vanilla FHA Loan, and those steps can be painful, prolonged and expensive if you don't get a lender that can really lead you in the right direction.

As for the zoning, that's another HUGE hurdle to eclipse, especially in the city of Chicago. You will need to check the current zoning and to add an additional unit, you will need a full set of plans, on top of potentially a new water service line (ouch that's expensive) from a licensed architect to get the city to certify the 3rd (new Unit). 

Start small, work slow and be reasonable in your expectations. Duplexing down might make more sense and be more feasible if the basement isn't currently suitable for living. You can get your money back going down. I dont have any experience with clients going into the attic. 

Just my $0.02 after having been a part of/observing all of the intricacies of thees types of loans a few times annually. Calling on all BP contractors contradict my opinions or show me a new way to get this done. 

@Jack Zhuang - Review the Contract to see what it states RE prorations. In Illinois, my home state, prorations are final as of the date of closing unless there was an issue where the Buyer was shortchanged due to property tax exemptions not inuring to the benefit of Buyer post Closing. 

Investment Info:

Single-family residence fix & flip investment in Markham.

Single family residence. REO acquisition, FHA resale.

@Christopher Petrillo is correct. There has been a change in the law such that Wholesaling now requires that you are a licensed Realtor in IL

@Ahmed Let's be clear as crystal about WHEN attorney's can act as a 1031 qualified intermediary as THIS IS COMMON MISCONCEPTION. The United States Treasury covers this in Reg. 1.1031(k)-1(k)(2) for those of you who like reading. 

The Treasury Regulations state that someone who has acted as the taxpayer’s employee, attorney, accountant, investment banker, real estate agent or broker within two years prior to the date of the closing of the sale of the relinquished property is the agent of the taxpayer and is disqualified to act as the intermediary for that taxpayer. This means a seller of property CANNOT HAVE THEIR attorney, real estate agent, etc. hold their proceeds if they intend to complete a 1031 exchange. Also DISQUALIFIED ARE ALL THE ATTORNEY'S in the same firm as the seller’s attorney and any real estate agent in the same brokerage as the seller’s real estate agent. THERE ARE TWO EXCEPTIONS TO THE DISQUALIFICATION. 

BOTTOM LINE - ALWAYS SELECT/ENGAGE  an unrelated 1031 Intermediary company. Any extra work to do this is sure to be less than that of an IRS challenge or the complications and resulting tax implications from a failed 1031 exchange. 

@Pete Sloa Glad to walk you through the process if you still need help. The analysis and answer are awfully long explanation for a BP post. 

@Mike Barry Happy to send you a similar set of contacts depending on the grade and type of the investment property

@Ricardo Green The customary practice is that the Seller's attorney/Broker(agent) selects the title company. 

@Clint Votruba has offered some sage advice