Real Estate Agent · New York, NY · Member since 2014 · 160 posts · 45 votes
Hi All, I've been looking at purchasing a vacation rental in Rincon, PR...a beautiful small surf community I've vacationed at for years. I would be going in on this with a friend, and was just informed that in PR if you're married the spouse has to be on the loan. We're both married, and prefer to not have our wives on the purchase (too many chefs in the kitchen). Does anyone know of this and if there's any way around it?
That, and if anyone has any insight (positive or negative) on the PR market, it would be greatly appreciated. Of course, the real estate agents say the market in Rincon specifically is not as affected as other areas.
Investor · San Juan, PR · Member since 2013 · 71 posts · 50 votes
10y
@Brandon Cohen: PR is a community property state. Your wife will have to be on the loan. If you have a prenup, then you can show it to the bank and they will not require her signature and you can register the property in your name only. Make sure the Property Registrar states on the deed that it's your private property.
The option of an LLC which @John Quiles mentions is an option. However, I think it will be difficult to get the loan with the LLC as guarantor. A workaround would be to put the property in the LLC's name and also provide a personal guarantee for the loan.
You will need to check with a lawyer if you are worried about how this will affect everyone's rights in case things go sour or someone dies before it's all paid off.
Investor · Orlando, FL · Member since 2016 · 49 posts · 16 votes
10y
I'm from Puerto Rico. You have to take your NY glasses off and think you are buying in Detroit. Properties are that cheap right now. Make sure you are not over paying for them. You can find beachfront properties in the $100s. Are you looking for a condo or a house? I don't know about the wife needing to be in the loan, never heard of it, but in my opinion the easiest thing would be for you guys to open an LLC with only you 2 as equal members. That may be an option.
Investor · San Juan, PR · Member since 2013 · 71 posts · 50 votes
10y
@Brandon Cohen: PR is a community property state. Your wife will have to be on the loan. If you have a prenup, then you can show it to the bank and they will not require her signature and you can register the property in your name only. Make sure the Property Registrar states on the deed that it's your private property.
The option of an LLC which @John Quiles mentions is an option. However, I think it will be difficult to get the loan with the LLC as guarantor. A workaround would be to put the property in the LLC's name and also provide a personal guarantee for the loan.
You will need to check with a lawyer if you are worried about how this will affect everyone's rights in case things go sour or someone dies before it's all paid off.
Real Estate Agent · New York, NY · Member since 2014 · 160 posts · 45 votes
10y
@John Quiles@Victor Chico thank you both for your insight...this is new to me and certainly not the way it operates in NYC. Not that I'm necessarily concerned about marital issues, more of a way to simplify the process. It may be that it's a necessity to have all on the loan.
Wholesaler · Grand Rapids, MI · Member since 2015 · 24 posts · 7 votes
10y
Love Rincon! We are scheduled to be there for 2 weeks right after Christmas this year. Wife and I have been there at least 5 times, and hope to have a place there some day as well. Let me know if you need any legwork done down there during that time
Santa Rosa, CA · Member since 2016 · 5 posts · 0 votes
9y
My understanding is that it is much easier to purchase property if you are not married. However you have an option of creating an LLC instead of purchasing the property as a individual married person. Very complicated! Consult an attorney or accountant before you make the move.
Santa Rosa, CA · Member since 2016 · 5 posts · 0 votes
9y
I'm trying to buy in Rincon also. However I feel like I may have missed my window of opportunity. As the prices have dramatically been going up over the past year. Good luck to you.
Maybe we will be neighbors?
Santa Rosa, CA · Member since 2016 · 5 posts · 0 votes
9y
I am also looking to buy vacation rental property in Rincon. I have been searching for 2 years and recently settled on Rincon.
Pros and cons:
Pros: it's Americanized, you get beautiful West Coast sunsets, The prices are good (but rapidly increasing), you could get good rental rates on short-term rentals during the high season. I have found that most people are willing to "owner finance" with a large enough down payment.
Cons: there is a shorter season for short-term rentals, the long-term rental rates are very low (which means you may have empty units or little rental income off-season), they get hit with a lot of storms and their rainy season and the power goes out and they shut off the water occasionally, A back up generator is a must,
Over the past two years I have seen the prices dramatically increase. I am hoping I have not missed my window of opportunity. I am currently in negotiations for a four Plex which requires work but potentially could be worth it.
Is anyone interested in investing for partnering on this property?