All Forum Posts by: Terrence Bayly

@Bill Exeter and @Dave Foster thank you so much for your insight. You guys consistently provide solid 1031 knowledge to the Biggerpockets community. I have been talking with my CPA and legal advisors to ensure our plans even stand a chance before moving forward trying to execute a plan.

If I own an investment property titled in my name and my business partner owns a separate investment property titled in their name, is there any arrangement where we could each sell our investment property and pool the funds to buy an apartment building together utilizing a 1031 exchange?

We have an operating LLC in which we are the sole members. Could we transfer title on our individual properties to the LLC, sell into a 1031 and then purchase a single like kind property in the name of the LLC?

Any other options? 

Thanks.

I am looking to acquire a medium to large sized multifamily apartment (40+ units) in Milwaukee so would love to chat with anyone in the market. I have a few 4 flats and BRRR SFHs in Chicagoland but am looking in Milwaukee for the bigger multifamily.

I second Russell's recommendation to pursue the lower non-utility section 8 rate. I rent a rowhome in Deanwood through section 8 and it has been great. DCHA pays the listed rate on their website as long as the unit meets standards. 

For timeline purposes, DCHA is running a little behind due to covid operations. You have to obtain a Basic Business License (easily done online) if you havent already. Your unit also has to pass a DCHA inspection prior to lease signing and tenant placement. This shouldnt take longer than a month to coordinate but has been slower due to covid. It took me about 6 weeks to get my unit inspected and tenanted back in May. 

Also keep in mind when calculating carrying costs and reserve amounts that the DCHA systems take a month or two to get payments coordinated once your unit is tenanted. It is common to not receive the first 2 months payments while the system coordinates everything but then you will get a lump sum payment in month 2-3 for all back dated money. 

@Harjeet Bhatti thank you for clarifying the rules. Now we know as we move forward.

@John Warren waiting the 6 month seasoning period is my backup plan. Obviously I would like to get my capital back though as quickly as possible to be positioned for the next opportunity. 

@Mark Ainley I would love to talk to your contact who may be able to do it without the seasoning period. As I said, I have two SFHs I would like to do this for – one ready now, the other in about 4 weeks.

Thanks everyone for your insight/assistance.

I recently purchased a SFH in the South Chicago suburbs 1 month ago to BRRRR. I identified a lender at the beginning of the process who said they would be able to do a cash out refinance once the project was complete and did not require a 6-12 month seasoning period. We went ahead with the project with renovations on schedule to be complete this weekend and a tenant ready to sign a lease. We did the entire project in cash so own the property outright.

Purchase: $90k

Reno: $10k

ARV: $140k

Rent: $1,350/mo

I am getting everything teed up for the appraisal and cash out refi. The lender is now telling me that they can do the refi without the 6 month seasoning period but only for an amount up to the purchase price. This somewhat defeats the purpose of a BRRRR. We don't want to wait the 6 months if possible with all the discussion of potential drops in home values, uncertainty with covid, unknown market trends after the election, etc.

Does anyone have any recommendations in this scenario to get my money back out of the deal without a 6 month seasoning period? Ask around other lenders? HELOC?

I bought a second property with similar numbers in the same area for which I will need to execute a similar strategy.

Thanks. 

Kevin Bayly, Esq. at Community Title Network has done great work for me and other DMV investors. 

@Antwoine McCoy, I also wont be able to tune in at the scheduled time but would love to hear what you have to say. Let me know if there is a recording available or alternative time. 

@DaveFoster thanks for the reply. My QI is looking into the possibility of a construction escrow. I know they are in charge of decision making, just curious if people have done something similar to what I am looking to do. 

I am in the process of acquiring a replacement property through a 1031 exchange. Fortuitously the replacement property has a separated basement unit that could be finished to make a second rentable unit. Is there a creative way to use my 1031 funds to finish the basement unit. 

I have $130k in 1031 funds being held by my QI. $80k will go towards acquisition of the replacement property. To avoid boot I was hoping to use the remaining $50k towards the basement unit. Is this possible rather than be left with boot or look for a second replacement property?