All Forum Posts by: Paul Sverdlin

Selling will mean capital gain taxes, realtor costs and a bunch of other expenses. Buying another property within the next few years may be even more expensive if some predictions about lower interest rates come to fruition. In that case values will go up. If you have an investment in mind where this money will grow that would be a great avenue to consider, however I am somehow skeptical that in today's market you will find a "deal" that positively cashflows and has a great potential. 

$1200 a months is painful to carry. I'd look at stretching that mortgage out as far as possible (30 years) to reduce monthly payment. One strategy that helped with my condos is to start charging for parking and locker separately. Some tenants don't want to pay for the locker use, which is fine. I just put up an ad at front desk and instantly make $50/month from it. Similar deal with parking. If none of that works then perhaps selling is an option unless you have some cash to put towards mortgage principal to reduce that payment even further.

In Ontario you need a permit to ensure that all renovations are legally permitted. It not just about having a second exit, there are lots of nuances at municipal level that you have to explore. 

Financially this will increase the value of your home and will bring cashflow. There are also risks with bad tenants and all kinds of tenant-owner dynamics to keep in mind. For example they could start cooking with spices you don't like and there won't be anything you could do to completely remove the scent. It is possible they will have guests over and make day-time noise which your wife won't appreciate. Etc-etc. 

I did it for 10 years in my prior home and was happy with the cashflow, so its definitely doable. 

Hello everyone. Looking for a trusted tree removal referral. Have a large tree to deal with in zip 43227. Its a rental property, thus I am looking for an inexpensive solution.

Thanks in advance!

Hi Vinod. Quite inspiring. Wonder how you manage flips in Calgary while living in Toronto. Would be great to connect. I've done a lot on my own, but pulled back lately due to high financing costs. 

Paul

Was thinking about it but did not go. If you went, how was it? Anything practical and actually applicable or just a bunch of fluff?

Note that CRA does not recognize LLC as a legal entity. Setting up any business opens you to a liability. I would suggest a C-corp in your case from both protection and taxation perspectives. Canada will tax you on income that you make world-wide. However if income is earned within a Corporation and does not get paid out to you as an owner, then CRA and IRS won't be taxing you on a personal level at all. You can re-invest that money in the business.

Lots of personal details to consider in matters like this. Better talk to a couple of cross-boarder lawyers and accountants to figure out what works best for you. Bigger Pockets is just a forum for directional recommendations, its not a place to get legal and financial advice on your own personal level.

HELOC is treated by Canadian banks as money you already fully borrowed up to its limit. Even if your HELOC balance is $0, you can take it out at any time and hence banks just count it as used up. Makes no sense to me personally, but that's the reality of it.

It is great to have access to your equity at all time though. Personally I took collateral charge options whenever those were available. Without it your equity is kind of stuck and without full-on refinancing or selling it is tough to accesses. With a HELOC I am always on stand-by to buy a deal if it comes up.... even though banks may give me headaches with the new mortgage applications because I have HELOC's. Got to pick your priorities.

Been investing in US for over a decade. 

Please be more specific in what you are looking to get answers to. "Anyone with advice??" is kind of hard to address. Feel free to reach out.

Quote from @John Fierke:

Son has ZERO active Credit History!

We live in Columbia, MO and there are 3 college campuses here with several renowned graduate programs so we feel like the rental opportunities would be strong.

What can he do?

Credit card is the way to go. Many banks try to win new clients by starting them early and offering a "student" credit card. If that fails, try local store credit card (Home Depot, Macy's, etc). If that fails, see if you can get a secured credit card. The key is to ask for a small limit ($500-$1000), activate the card by making at least on purchase, pay it on time, and in a few months that credit file will be steadily building up. Within 6-12 month your son will have the Score he needs. 

Mortgage of $216,650 at 6% is $1,290. We are $300 in negative cashflow before considering any other unforeseen issues. 

Property tax of $19 / month, is that accurate? Seems low.

$205k for a property in North York likely means its extremely old, in a crappier area and may not have the best capital reserve. Is the condo well-capitalized? Major repairs coming up? Who are the tenants and are you willing to manage them / have experience in managing them?

Just sharing some initial thoughts since it is not clear what the author is looking for in this post. No questions or information provided other than the numbers.