All Forum Posts by: Ryan Taylor

Hello Jordan,

I would recommend checking with a credit union, if you are a member on one that is. The smaller the better. I just used my local credit union to do exactly what you are doing. They really seem to make it pretty simple, at least mine was. Example of mine,

Applied online on Tuesday, underwritten and prelim pulled by Wednesday, signed Thursday...Funded the following Monday...Done! So I guess you can say I am a fan of credit unions.

Good luck with your search...and happy investing :)

Quote from @Chris Seveney:

Don’t go blow it on fancy cars and expensive TV’s etc.

First several years the $ made in real estate should be reinvested into cash producing asset whether be real estate, stocks or other alternative investments is what they are saying

Make your money make money...that's the goal

Quote from @Michael Plaks:

Quote from @Ryan Taylor:

POA stand for Power of Attorney document. If by credentials you mean login name and password - it's good to have, but it can be changed by the seller, and the lender will not share any data with you unless you have what is known as limited power of attorney. I cannot give you legal advice though, as I'm not an attorney.

Got it...makes since...and a POA is something I did not think of...can seller just authorize me with the mortgage co to authorize communications with me...is a POA kind of overkill in this instince...but I guess seller could always remove me from being authorized...that's where the POA would come into play i guess...something to think about...thank you Michael

Quote from @Michael Plaks:

@Ryan Taylor

I second what @Ashish Acharya said, and you are correct in interpreting the idea of capex "itemization." There're many details to depreciation however: can't depreciate land, different depreciation for different parts of the property, and not just for the additional improvements added by you. Yes, a good time to get professional help.

Two warnings about this situation. The first is that the seller will often assume that they are still entitled to their mortgage deduction since their name remains on the mortgage. It does not create a problem for you, since you are entitled and they are not, even if they break the rules. But it's a good policy to let them know in writing that they are no longer eligible for it, and have them sign an acknowledgement. It's also highly recommended to obtain a POA so you will be able to access this mortgage information from the lender, otherwise it may be a royal pain to get this data down the road.

The second warning is that you need to be careful to claim this deduction on the "other interest" line of your tax forms and not on the "mortgage interest" line, otherwise the IRS computer may start bothering you.

Thank you for that Michael.
Your warnings are noted. Can you please explain to me what a "POA" is. Since you said it is to access mortgage info...I'm going to assume you are refering to maybe an online account portal of sorts...if that is true...I have already obtained credentials for said account. And for the second warning...a competent CPA will know this...I would hope...thank you for the advise 🤙

Quote from @Ashish Acharya:

Capex is most likely depreciated. Itemizing can help you take bonus depreciation.

So you are able to take the standard depreciation at 3.636% per year...and by itemizing the cap ex that can increase? By itemizing you mean...x amount of dollars for new fixtures...x amount for paint...x amount for flooring...am I interpreting that correctly...
Thank you for you knowledge and advise Ashish...truly valuable 🤙

Quote from @Ashish Acharya:

You get to depreciate and you deduct the interest on all the loans. 

One more question...can the cap ex be written off as rental expenses...do I need to go on title prior to making the improvements for that to happen...

Quote from @Ashish Acharya:

You get to depreciate and you deduct the interest on all the loans. 

 Thank you for that Ashish...I figured that was the case...however not sure of the logistics of how it will work...I think its prime time to hire a CPA 😁

Good morning fellow investors....

So I am in the process of putting together a sub to deal...here Is the structure

347k purchase price...147k owed @3.750...I'm assuming the 147k...borrowing the remaining 200k @ 3% from the seller for 5yrs...ARV of approximately 435k with approximately 35k in cap ex...not a whole lot of meat on the bone...but this is a buy and hold strategy for appreciation...as well as cash flow...my question is this...

Since the 1st is still in the name of the seller, and me as the buyer being on title...from a tax stand point...who is able to depreciate the property...write off the interest on the 1st... and as it would be a rental...the expenses...

Thanks for all advise 🤙

So I was thinking....does PMI/MI seem a bit ridiculous...I'm mean...tacking on an additional 300/350 bucks a month to do nothing but protect a lender of default from the borrower...

Hear me out...your already qualifying for the loan...if your DTI and FICO support you getting debt...then perhaps something other than LTV should negate PMI/MI...maybe set the guidelines at an 800 FICO and no PMI/MI is warranted...dont you think this would "open the door"...pun intended...to price points that would otherwise disqualify a borrower because of payment with the additional PMI/MI included in the payment...

HOW CAN THIS BE CHANGED

Just a thought...what say you??

Quote from @Scott Trench:

Is it good form? No, not really. 

Is it common? Yes. 

The market is changing in favor of buyers, and your appraisal did not come in. 

I'm sure others will disagree, but I see no reason why you can't ask for the $15K. The seller might be happy that's all you ask for in this market. 

The bigger issue here is with your strategy. I'd hate the idea of buying and hoping for immediate equity, and relying on an expensive remodel to get to positive cash flow. That's a tough first deal. 

Dont forget the cost of the remodel...that's just further in the hole...if its financed... even worse...that will definitely affect your cash flow...and hopefully you had an appraisal contingency...you might be in a better position to negotiate than you think...

Good luck on the deal...hope it works out for you 🤙🤙