All Forum Posts by: Cam Smith

Here is another article I found about it. http://www.nytimes.com/2012/06/23/your-money/to-give-or-not-to-give-up-to-5-12-million.html?pagewanted=all&_r=0

Hi everyone, I was thinking about adding my son as a joint tenant to a rental property I own, If I do this it would probably be the equivalent of a $30,000 gift. I heard that there is a life time gift exemption of $5,250,000 in 2013. Obviously $30,000 is nowhere near that amount but does anyone know what the process would be for using this gift exemption? After I change the title on the property to joint tenants with my son how do I go about claiming the life time gift exemption to avoid taxes? Does anyone have any experience doing this? If we decided to sell the property in a couple years he would get half of the money is that correct? Here is some brief info I found about it online. http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/What's-New---Estate-and-Gift-Tax

• The annual exclusion for gifts is $11,000 (2004-2005), $12,000 (2006-2008), $13,000 ( 2009-2012) and $14,000 (2013).
• The applicable exclusion amount for gifts is $1,000,000 (2010), $5,000,000 (2011), $5,120,000 (2012) and $5,250,000 (2013).

Hi Carrie, thank you for the reply. Those are some good points I will definitely look into.

Hi everyone, I hope you are having a good summer.
My parents are separated and will probably get divorced soon. Would it be possible for my dad to buy two rental properties from my mom?(there are no mortgages on them currently, my mom owns them outright) If so how would this be done? Could my dad get a blanket mortgage loan for these two properties which are worth about $250,000 combined. My dad is making 80k a year and has a 720 credit score, he has had this job for a year and a half, he has about 15k in credit card debt and a credit score of 720 (we have quite a bit of cash reserves so could easily pay this off if necessary)

Would it be possible for my dad to buy these two rental properties from my mom with a mortgage? Could my dad use 75% of the rental income towards qualifying for the loan. Each house rents for about 1000 a month. Could they do this before they were divorced? I have done some research online with a couple lenders. How to get the best lender? Any on Biggerpockets?

Thank you for any advice

Hi Jay, Dave and Steven thank you for the additional info.

Hi Marco, Andrew, Mitchell and Lynn. Thank you for your answers.

Hi Bill, Steven, Mark and Joel. Thank you for your answers.

Hello all, we own two rental properties in Nevada and a house in California with no mortgage. We inherited the house when my moms parents passed away back in 2008. My parents are getting a divorce and mom wants to take the two homes in Nevada and give my dad and me the house in California. THE PLAN IS TO SELL THE HOME IN CALIFORNIA AND WE HAVE A BUYER INTERESTED. I heard that in California if you live in a house two of the last five years you don't have to pay capital gains taxes when you sell it. What is the best way to proceed legally to avoid problems and taxes? Should my mom sign a quit claim deed prior to sale and give my dad the home? Then I guess he would sell it from his name to the buyer? Or would my mom sell the home first then give the money to my dad? AND THEN AFTER ALL THIS SIGN AN UNCONTESTED DIVORCE?
Also my dad wanted to put the proceeds from the sale into my bank account for me to invest the money in some rental properties. Can he simply wire the money into my account? Or will this cause a big tax problem? Maybe better to keep it in a joint account? Thanks for any advice. Have a good weekend.

Hi Marco, thanks for your reply. So you're saying apply for a mortgage for the new property then get a heloc on the 150k property we have now to get money for the down payment? That sounds good. My first thought was to try to get a home equity loan by pulling out 80% of the 150k which would be around 120k and then buying another rental home outright with this money. Any thoughts on which would be the most effective strategy?

Thank you

Hello all, I was just looking for some opinions on the best strategy to proceed. We have one rental property worth about 150k that we own outright and we were thinking of getting a home equity loan on to buy an additional rental property. Is this the best strategy or would it be better to just apply for a new mortgage to buy the new property with? What kind of loan usually has the best terms? I would think a regular mortgage would over a home equity loan it just seems kind of inefficient to have so much money tied up in the property that we own outright. Thanks for any ideas.