All Forum Posts by: Akash Sky

 Thats fair, we are not doing any of the actual work, so it makes sense to not receive  a lions share of the reward.  That being said, I would say that this investment turned out quite poor and will lead to a loss, even in the best case scenario (as the legal fee fund is going to take out a lot of investor equity).

Nope, its straight cash.  This means that they will give you a form at the end of the year for taxes to my knowledge.  Also, I'm pretty sure it would be taxed like interest income (meaning high tax rate).

I'd like to share an update as well.  I invested $240 initially (so that I could receive a measly $2 per month).  So far, I've been getting about that much each month.  I've also been reinvesting the proceeds into the fund.  It's been pretty interesting to see my monthly distributions grow each month by a few pennies.

I'm still a bit hesitant to invest more into this fund due to how their fund is legally structured and all the power they have over investors.  That being said, I do think I will put in another $740 into the fund.  After all, who DOESN'T want a free cheese pizza every month?

I can confirm your statements about Larry Loftis's book.  I borrowed it from the library yesterday and read through it a few hours.  It's chalk full of useful information presented in a nice story telling fashion.

My only issue is that the book does not go over how the income from the tax liens are taxed, i.e. short term capital gains, long term capital gains, interest income, etc.

I plan on giving Zero Risk Real Estate a read and then invest $1-5K in Tax liens later this year.

Hmm.  What do you think about moving to an area where properties are cheaper or purchasing out of your area where prices are lower?

that may be the case, as I know very well how lucrative buying debt pennies on the dollar can be.  The issue I have here is how much control they have over my position, ( they have the right to buy me out at any time).  Essentially there's a conflict of interest risk with this investment in addition to the regular buying non performing debt risk.  Can you show me a link to the performance of their past offerings?  I am actually thinking about invest a hundred bucks into this because of how interesting I think it is.  I just don't like how they legally worded their offering and the rights they have over me 

i was thinking about investing a hunded dollars into this.  The one thing i don't like is how much power they have over you.  Basically ,they have the right to reject your capital and essentially "pre-buy" you out.  So, lets say they hit a huge series of grand slams and are returning 20% / year annualized.  The company can buy you out and just keep their 20% / year.  Basically, you are taking a lot of risk and have limited upside.  I don't think its that great of an investment, but I like the concept and the ability to diversify into notes.

Pulling out equity from your primary residence is a dangerous game to play.  You don't want to be stuck with a high monthly payment that you can't afford and get underwater on your condo.  Regardless, if you find a great opportunity, go full steam ahead and use some equity to fuel a deal!

I'd recommend that you consider doing a live N flip.  Since you have lived at your personal residence for at least 2 years, you won't have to pay taxes on the $100K that you gained in equity (should you choose to sell your condo).  You can take that money and finance another condo that you can fix up and live in, (thus resetting the 2 year timer for when you can cash out without paying taxes).

Ideally, you could do something along the lines of house-hacking, but multi-family rentals in orange county right now is priced pretty high, and its very difficult to find something that cash flows  (Although with a 100K down-payment, maybe you could make something work).

Keep up  the hustle!  It looks like you are doing great.

@Account Closed

Thank you all so much for your input!  I've definitely got some new things I want to keep in mind when evaluating deals based on area, and some direction as to how to evaluate an area.

Other than the ARV (after repair value), does area have any impact on your flip strategy? For example, what changes in your deal analysis do you make to account for the area's quality?

In addition, what things can I look for in an area (online, preferably) in order to estimate whether it is an A, B, C or D?.