All Forum Posts by: Roberto Westerband

@Chris Wilson It's good to hear this is a viable option. Did you have to negotiate with the bank/credit union to get LIBOR? 

@Arlen Chou will you be doing the same with the investment property (i.e. refinance as a 1st position HELOC)? Just wondering if you can somehow combine this strategy with the BRRR strategy

@Daria B. when I say 1st lien HELOC I mean I have a current mortgage and I want to refinance it as a HELOC. So the HELOC would hold 1st position on the owner occupied property (if this was possible for non-owner occupied properties, even better). Now, I don't know if that 1st position would be in the form of a note or a UCC, but either way it would be secured by the property as collateral.

Thanks @Daria B. 

I'm hoping taxes/insurance aren't part of the loan so that I can put some credit cards to work and leverage rewards etc.

Also, I've seen 1st lien Home Equity Loans, but not 1st lien HELOCs; hoping that product exists, at least via credit unions etc. 

What does the BP community think about 1st lien HELOCs as a way to free up equity in your primary home for investment purposes? If anyone has gone through the process, can you give any advice as to whether you recommend the strategy or if it is not worth it?

HELOCs usually have a 10 year draw period interest only before amortizing out. 

• If you have a 1st lien HELOC, what happens to escrow for taxes and insurance, can it be waived and paid out of your own pocket or is it tied up into the monthly payment?
• With regards to recourse vs. non-recourse loans, would putting the HELOC in 1st position allow a bank to come after personal assets in the event of a default?
• Are there any banks/credit unions that charge LIBOR instead of Prime on HELOCs?

@Dmitriy Fomichenko @Mark Nolan Thanks! Under what circumstances would an independent contractor or part-time W2 employee be considered full time aside from # of hours worked per week etc.? 

Also, would an individual be able to borrow against their solo 401K? If so, what limitations exist in doing this as it seems you'd basically be paying yourself back?

@Mark Nolan

I have read here on BP that solo 401K's are only applicable to small business owners who have no full time employees. What if your business only hires independent contractors/freelancers? Can that business still open a solo 401K? 

What are the minimum and maximum contributions per year to a solo 401K?

@Mark Nolan under whose name can the brokerage account to use checkbook control need to be in? Also, aside from earned income, can proceeds from a property sold be placed into a solo 401k?

Check out Scott Smith on podcast 109. He talks in-depth about series LLC's with anonymity trusts. It's an asset protection strategy, I'm sure there are others. The way a series LLC is described in the podcast is having a Parent-Child relationship. From what I understood, there is one holding company filing and multiple series (children) formed within it, each having their own liabilities as if they were individual LLC's. It seems to also provide the benefit of having to file only one company tax return, although I'd like to learn more about how that would work.

@Tim Stolt I also see an umbrella policy as a requirement in asset protection. I see a series LLC as a way to avoid getting sued; and an umbrella policy as a way to limit your losses once you do get sued.

Has anyone created a Series LLC? What are the pros and cons? At what point in an investor's portfolio would he/she need a series LLC and umbrella policy?

If a property is owned free and clear by an LLC or Trust, does it require title insurance? What other type of insurance instrument can be used in lieu of title?