All Forum Posts by: Peter Davis

Great new forum. My wife and myself have been considering renting our primary residence for a couple of weeks during the summer but have been nervous about the risk. After speaking to other friends in our area who have done this it appears like any other rental the biggest issue is the renters. But we have found that most of the people who have recently done this have had no issues and in my area a monthly rental income for a month can pay for a 2 week vacation and a whole lot more. We were lucky enough to have purchased just before prices skyrocketed in 1999. With rentals of homes similar to ours going for 20-25k/ month it looks like we are going to give it a try 

I get nervous with the VRBO and other sites, any opinions on using local RE agents ? I would assume it would add a layer of safety and insurance to the equation. Sort of like a short term property manager at around the same rate.

Zamir,

As everyone on this long thread has stated, every county has own rules. i have been watching many of the online Florida sites and MANY of the sales have the rules below. Purchasing the first and second liens DOES NOT give you any advantage to owning the property. You have to start and pay for the foreclosure process and then the property goes to auction. You will get your money and interest but unlike many other states and counties in below example (Palm Beach FL, ready for sale now), buying the liens that are bid down will only give you option to pick up second year lien at full rate. Property goes to highest bidder after you initiate foreclosure.

READ every counties rules carefully and per Ned, the hedge funds are chasing these especially in nicer areas in Florida. 

Pete

Now you own a tax certificate, so what can happen next?

A certificate holder is not allowed to contact the owner of the property carrying the delinquent taxes for two years. Such contact can result in costly legal action.

When the owner pays the delinquent taxes, the interest is calculated and a check is sent out with a notice to the certificate holder.

The certificate can be sold and transferred (for about $2.25) to another name.

Let’s say the owner doesn’t pay the delinquent taxes. Two years from the date of the delinquency (April 1) but no longer than 7 years, the tax certificate holder can request a tax deed application. This process starts the foreclosure of the property. To foreclose the property, the certificate holder making application for a tax deed has to pay the Constitutional Tax Collector an application fee, a title search fee and all amounts required for redemption or purchase of all other outstanding tax certificates, interest, omitted taxes, and delinquent taxes as well as applicable Clerk of Circuit Court fees, relating to the real estate. In most cases the property is scheduled to go to sale at public auction by the Clerk of Circuit Court within 3 to 4 months from the date of the tax deed application. Holding the certificate creates no advantage towards owning the property. The highest bidder becomes the owner of the property. If the property is a non homesteaded parcel, the opening bid is the amount of the taxes, accrued interest, plus costs and fees involved in a tax deed application. If it is a homesteaded property, the opening bid is half the assessed value plus the tax certificate face value and costs

Andrew,

Be very careful with these Sandy homes. It WILL be a tear down and most likely be need to be raised especially in E. Rockaawy. Check the new FEMA flood maps and also verify you will even be able to get flood insurance. Many people in that area are not rebuilding or can't rebuild due to costs and are walking away from their homes. It is unfortunate because it used to be a nice area.

Pete

I would also like to thank @Darren Sager and all who helped put this event together and especial thank @David Keulac for taking the time and putting together an extremely good presentation on tax lsales and being accessible to all the BP attendees. I am sure it helped many in attendance get at minimum a place to start to research and safely invest in tax sales. For someone with his experience and knowledge to personally donate his time to help others without looking for something in return is refreshing these days. My first BP meetup and definitely not my last. 

thank you all for responses, does anyone have any experience with using credit unions? 

David,

Not an attorney but ANY self dealing within a SDA IRA is considered a prohibited transaction. I would not take the chance or risk of penalties to save on some RE commission. From what I have read and researched you can't even change a door knob. Kills me to pay someone to do these things but not worth the risk to your entire investments.

If you still want to do this I would check with appropriate tax accountant who is very familiar with these types of IRA's. There are not many out there who are very good and your custodian will not give you an answer for fear of being wrong.

Good luck

Pete

Thanks Dmitriy, yes i do have Wells Fargo cloe and know they are nationwide.

Will look into them

Pete

I totally agree with complete diversification. If you are lucky enough to have employee match program what better way to get an immediate 50% return on investment. I was just out of college when I started working for my company and was not allowed to leave until I signed up for the savings and security program at work. That was almost 30 years ago and as Einstein said, there is no greater force in the world than compounding. Not only do I have a pension to look forward to but quite a retirement portfolio as well. Not to mention putting away money every year into a Roth so you have the tax free finds when needed. After 5 years of putting in just 7% for company 3.5 match, I increased to 15%. Think of it as forced savings and it is money you really don't miss.

I live in NY and already have a SD IRA llc but the bank I use kills me with fees. Was just wondering if anyone had any ideas of some good " buisness friendly" bank for all types of transactions. Some of investing will be outside NY and am currently looking into Virginia and Maryland . Just tired of the crazy fees charged for wire transfers, checking, certified bank checks, etc. I don't get hit with these fees on personal banking so hoping to find an institution that is RE friendly.

Any thoughts on credit unions ?

New to BP, experienced tax lien, future tax deed invester. Have been reading BP blogs for years and finally decided to "go pro" more as a thank you to all I have learned from all the other BP investors. Taking my REI to a new level and looking forward to meeting and listening to all my NY counterparts. Most of my past investments have been outside the U.S., now it is time to start playing in my own backyard. Thank you for setting this up and look forward to meet up with people with similar mindset.