All Forum Posts by: Bryan Zuetel

@Calvin Rankin, I agree with those here suggesting that you avoid this transaction.  The difference between you wholesaling this and others wholesaling or buying the property is your knowledge and their lack of knowledge.  Since you're well aware of the potential issue (and have confirmed your knowledge here), you can be implicated for any role in non-disclosure of potential issues in this transaction.

@Marina Flu, since you paid cash for the property, ask some local lenders about delayed refinancing programs.  No need to wait 6 months.  This can be a conventional loan, so I would suggest that you with conventional lenders for better rates and terms.  The loan will be primarily calculated on your personal income with some specific amount (maybe 75%) of your property income added to that.

@Michael Mueller, no you're not interpreting the statute correctly.  In your scenario above, the lease has been broken and hence cancelled/terminated, not expired.  At the time that the lease is broken/cancelled/terminated, there is no lease term remaining to expire.  So, you would be obligated under that statute to timely return the appropriate security deposit amount and statement within 21 calendar days after the tenant has vacated the premises.  Interesting idea nonetheless.

@Account Closed, I think that the problem with your scenario is that you haven't provided us the location of the property.  Such information is necessary to answer your question.

@Scott Smith I'm curious about your comment above: "You only have to have a DST if you're going to be owning CA real estate with it. I don't see the FTB pursuing foreign LLC's owning foreign assets (outside of CA = foreign) just because one of the members is from CA."

I've wondered that myself, if I have a Georgia LLC owning Georgia property but I am a California resident/member/manager, will the FTB really pursue the LLC or me for the franchise taxes? I know that it's a hypothetical and we can only speculate, largely dependent on the whims of the FTB. However, are you aware of any statistics or even anecdotes of the FTB doing this?

Further to the point above by @Jeff C., California's almost-mandatory disclosure, the Real Estate Transfer Disclosure Statement, asks the seller in C.12. to disclose whether there are "neighborhood noise problems or other nuisances." If the seller checks the box for no, the seller implies the opposite of neighborhood noise problems, which would be a quiet neighborhood. If the seller checks the box for yes, the seller is asked to explain the neighborhood noise problems below. I seriously doubt that a state like California would mandate a disclosure that violates federal Fair Housing laws, and I have seen no specific citation to any HUD or Fair Housing regulations to the effect that "quiet" is violative of fair housing rules.

@Brad Carter, if you are the final bidder at a tax sale, you will receive a tax deed.  The tax sale will eliminate mortgage holders that received notice of the sale, but it will take a mortgage holder asleep at the wheel to allow a tax sale and elimination of the mortgage.  Note that the tax sale does not eliminate certain superior liens, such as an IRS lien on the property.  I would suggest that you research a tax title certificate, which is a private company that does the necessary research and provides a guarantee that will allow you to obtain title insurance on the tax foreclosed property.

@Jake Snavely, if you want to avoid the $800 California LLC tax plus registering the California LLC in Alabama, use a trust and sufficient insurance. If you want the protection of an LLC (which is diminishing in its protection power), use a California LLC and pay the taxes and fees. Don't use a series LLC while you remain a California resident.

@Brandon McLendon, in Long Beach, you have some great options to buy with an FHA 3.5% down program. There are many singles and 2-4 units that could use some work in Long Beach and surrounding areas. Stay close to Long Beach for your property, if you have that luxury.

@Kevin Barnard, if your property is in rent-controlled Los Angeles (not all properties are under the LA rent control scheme), you may have some issues with the rent control, rent increases, and evicting this tenant.  If you intend to occupy the larger unit and make that the reason for eviction, you may mitigate some of those issues.  Get that tenant out before he figures out the heavy hand of government rent control.  And enjoy some more space with your growing family.