All Forum Posts by: Tim L.

Nothing to add other than I love Maui and I hope you find a way to close this deal.

@Brian Garrett No, the property is in West Palm Beach. I would love to find something with those numbers in the Gardens.

@Logan Turner Thanks for the advice. HOAs are pretty prevalent down here in most relatively nice neighborhoods. The few good areas without HOAs are much more expensive. But I agree, $340/mo is killing my profit.

@Michael Farley Thanks buddy. I'll pm you.

@Melvin List Good advice, thanks.

Brent Coombs I definitely don't count on the appreciation continuing, or getting as good a deal as my last one (although I would like it to be close). I just want to put some of the equity in my current deal to use for my next one. Right now I consider that money just sitting there stagnant. I want to make it work for me to make more money.

Thanks Steve Vaughan That was my thought as well. I definitely have the opportunity to reinvest at 10%+ cash-on-cash ROI. I also want to get another property under my name ASAP to continue building for the future. Like the other poster mentioned, it will all depend on the appraisal. That's the part that worries me.

Hi guys, stupid question time.

I'm looking to refinance my rental property, in order to free up cash to purchase my next rental. I was wondering if someone could help solidify the numbers for me.

Original purchase price: $125k (April 2015)

Current property value: $160-180k. 

This is a big spread, I know, but houses in the neighborhood are selling in this range and mine has some of the more desirable features (waterfront, remodeled kitchen/master bath, and tile/laminate floors where most have carpet). I feel pretty comfortable placing the appraisal at $170k.

Current mortgage balance: $94k

Current mortgage payment (including PITI + $340/mo HOA): $1030

Current monthly rent: $1450

My credit is excellent, and I have a good w-2 salary, so I assume I will get a favorable rate. However, I'm worried about the new loan cutting too much into my profit. As you can see, I'm already stretched pretty thin. The good thing about this property is the HOA covers everything outside the front door, and the water heater/AC are no problem for the foreseeable future. In other words, repairs have been (and should continue to be) minimal.

I'm ok with taking a slight hit to my profit on this deal, as long as it allows me to purchase another property to make that profit back. 

I'm hoping to net $25k cash after refinancing. Is this possible?

@Michael Bryan Care to share what you found/how you went about finding it? I'm currently searching for the same thing in Palm Beach County, but having some difficulty. 

@Deanna McCormick Can you explain a little more about how your situation worked? I would love to have my mom live there for free and be able to take a tax loss if it works. I just don't see how that could possibly be advantageous in a tax sense.

Thanks for the info everyone, and I will definitely be running this all by a CPA before I make any moves.

@Linda Weygant My mother's only income right now is social security, which is a laughable amount. I've been giving her $400/month, which is what I would like to convert to income for her (she's at a much lower tax bracket, so hopefully I would then be able to deduct it as wages to minimize my tax burden). I really don't see that affecting her social security payments, but I'll keep that in mind.

I'm just trying to get all my facts and ideas together before I consult with a CPA.

I'm considering purchasing a home for my mother to live in, since she is currently renting and unable to purchase a home for herself. I will charge her fair market rent, but I want to make sure that I am able to claim it as a rental property, and get all the tax advantages (depreciation). The problem is, I have been giving her money every month to help her pay her current rent, and I want to continue to help her.

I'm thinking of including her in my business, as a bookkeeper, and pay her a modest wage similar or greater to what I've been currently giving her. This would also help alleviate time for me to focus more on growing my business, so it would be a win-win for everyone.

Is this a sound strategy tax-wise? I would love to hear from anyone with experience in this.

I can actually make this one! Hip hip hooray!