All Forum Posts by: Steve Babiak

For those wondering about the "SITE" option, I have posted about that on this other thread:
http://www.biggerpockets.com/forums/25/topics/38111-search-bp-forum

Ralph,

I'm with you on this one.

In PA there is a "Writ of Execution" that is obtained to proceed to the sheriff sale, so it sure sounds like one of those to me.

Some of the other types of repo I am aware of:
Tax deed sale (the owner did not pay taxes for some reason)
Confiscations by law enforcement (that would make former owner a participant in criminal activity - I say no need to deal with those types of people)

Words I once heard: "When a homeowner is losing their property, one of two things has to change: their financial condition has to change for the better, or they have to change their address."

Mortgage interest deduction for personal residence phases out with increases in income at a certain threshold (depends on single or married status).

Mortgage interest on a rental can ALWAYS be deducted from the rental income on a rental.

To not lose any mortgage interest deductions, my CPA wants me to start looking at paying off the house where I live, by taking refi money from the rental property!

As to whether you will really have better cash flow ... It is said that any property can have positive cash flow as a rental when it is paid off in full - that is a given. So that bigger mortgage on your personal residence will be paid by you taking income from another source (say your 9-5 job). Effectively, this means that you have that other income subsidizing your rental so that the rental looks better as a rental. I just don't like the idea of me working extra to make the rental a more affordable thing for a tenant by subsidizing that rental with my other income source(s).

As to the 1031 exchange: if you were to have a HELOC on your personal residence, you could use that to instantly pay off the mortgage balance if needed to facilitate a 1031 exchange; so you can defer the full payoff until you are in a 1031 exchange scenario.

The best advice that I've read in the other posts in this thread was to use your CPA for tax PLANNING, not just tax preparation. And then the suggestion that your funds might do better by being invested in more properties.

I would suggest the following: have mortgages on the rental properties to the extent where they still cash flow positive (do not over-leverage into negative cash flow); have your personal residence paid off, AND have a big HELOC on that personal residence for emergencies or for investing further. Some even consider that big HELOC as a form of asset protection, since the equity in that property appears to be less than the value of the paid off property (supposedly to keep the lawyers from pursuing lawsuits against you with the property as the target to get paid out of).

Search the forums for the topic of "subject to", sometimes "subject 2" or "sub2" will be used.

Some audio teleseminars can be downloaded from here:

http://www.larrygoins.com/brainpickapro.asp

Originally posted by Jeff And Cheray Warner:

...

Why take a chance and potentially loose a deal when you can get accurate data from a title company, realtor, or tax assessor??

Jeff

Using "accurate" to describe "tax assessor" just doesn't seem correct in most cases. Getting sold data for comparables from the county recorder of deeds would be a more accurate county gov't source for this type of data.

Here's the fundamental problem with what you suggest: The former owner was unable to afford that house before (otherwise they would not have lost it), so what do you think has changed so that they can now afford to get that house from you? Unless their financial situation somehow improved, or unless you are looking to operate as a non-profit ...

Try this thread for a bunch of BP links I posted regarding getting comps:

http://www.biggerpockets.com/forums/103/topics/39825-investor-making-an-offer-on-a-short-sale

And this one seems worth reading too:
http://www.biggerpockets.com/forums/93/topics/40912-cyberhomes-com-vs-zillow-com-the-battle-of-the-century-

And don't forget to vote for that post if you find it worthwhile.

Try this thread for a bunch of BP links I posted regarding getting comps:

http://www.biggerpockets.com/forums/103/topics/39825-investor-making-an-offer-on-a-short-sale

And don't forget to vote for that post if you find it worthwhile.

Try this thread for a bunch of BP links I posted regarding getting realtor's license:
http://www.biggerpockets.com/forums/55/topics/39235-new-member-from-phoenix-az

And don't forget to vote for that post if you find it worthwhile.