All Forum Posts by: Dan Schwartz

@Michael Plaks thank you for clarifying

@Michael Plaks to clarify when you say the driveway repair can be written off immediately: are you referring to only the $1800 repair option, or would it also apply to the $2800 option if the invoice items are each below $2500 (e.g. separating out materials, labor, etc.)?  Thanks.

@Steve Vaughan well, I, in turn, am happy to see you did this. I never saw the original post, but we have been in the process of implementing a similar plan. The mortgage payoff is done, but the HELOC still needs to be sourced.....

@Austen Mueller Richboro as in Northampton Township, or is there another one I don’t know about?

To finance (verb) = to borrow money in order to make a purchase. "Finance" a car, "finance" a boat, "finance" a house.

To refinance (verb) = to borrow money in order to pay off an existing debt (usually, but not always for the same asset).  

You have a car loan at 4%, but prevailing rates are now 3%.....you can "refinance" your car loan to the prevailing interest rate and save 25% monthly interest.

In real estate, you can refinance to 

a) lower your interest rate (like the car loan example above)

b) take out a loan larger than the one being paid off ("cash out")

c) extend the term of the loan (start a new 30-year loan for a residential house, or refinance a balloon payment, which is typical for commercial properties).

Keep asking questions around here.  You'll get it.

@Bjorn Ahlblad “interim final xxx” is common language with these directives.  I believe it means that it has not yet been published in the Federal Register. 

Fannie Mae will buy cash out loans up to 80%. Lenders can make the decision to impose a lower LTV. Just need to keep calling around. Good luck.

@Adriana Vergara just saw your additional question while reading through Dmitriy's good replies.  The self-directed solo 401(k) he describes is the best kind of vehicle, in my opinion, but my understanding is that if you have full-time employees in any of your businesses (the help you provide your boyfriend is probably also self-employment income, and I doubt you have a full-time employee in turn helping you), you are not able to open a solo 401(k).  Regular 401ks are available from many vendors, including places like Vanguard, I think.  It's not discussed much here on BP, because the majority of people are self-employed and engage only contractors for projects as opposed to fulltime employees.

If you believe you are eligible for a solo 401k, I strongly suggest you connect with Dmitriy.  If not, your payroll provider may be a good advisor for you.

Bottom line: choosing a provider is very important.  In the solo 401k route, you'll want some who is both on top of the applicable laws AND communicates them clearly and thoroughly to you, and in the non-sol0 401k route, you'll want a company that doesn't charge you an arm and a leg and also gives you (and your employees) access to a decent range of investment opportunities.

@Adriana Vergara Glad to help.

SDIRAs are simply an IRA with a custodian that allows for a much broader range of investment opportunities (within the confines of IRS regulations, of course). An IRA opened at TD Ameritrade can invest only in what TD Ameritrade offers (stocks, bonds, mutual funds, and for some investors, options and futures). An SDIRA allows for investment in all of that plus real estate, lending, cyrpto currency, precious metals, etc., so long as it doesn't create a prohibited transaction.

If you have a burning desire to come back to the IRA structure in the future, ask your payroll provider if you can include an in-service distribution option, and what the ramifications of that would be. An in-service distribution allows a participant to rollover 401k assets to another plan (like an SDIRA) prior to separating from the company. This may or may not be worth the trouble right now, but it doesn't hurt to ask while you still can.

Good luck, and keep us posted!

@Caroline Gerardo I’m sure many on BP would be interested in learning about this method of borrowing from IRAs. Will you share?