All Forum Posts by: Chandra Whittaker

Communications in the clearest of terms.There has to be the understanding that its WE as against I...i.e the venture or adventure is for the benefit of both parties involve. Mindset and approach will play a vital role in seeing the process to the finish line.The application of language is key here inclusive or otherwise.This is a bump on the road and not a stop sign,you can do it and win your husband over if you really want to see it happen and create a legacy for your family.

Good luck sista and have the mindset and attitude that says forward thinking and backward never.

Send him to the couch until he stops acting like a child. Tell him, the house is vacant, costing us money. It needs to be turned into a rental, since you will not sell the family house. The heloc can pay it, or he can sell his truck (boat, whatever), and give you cash for the required renovations. Seriously, this is not like my scenario what I was trying to convince my wife on getting into REI, she had to come around, and she finally did once she had a level of understanding she needed. You came in with this house, I assume communicated the desire to keep it and intent to renovate/lease. Now he's submarning it, because he can. On a more serious note, does he expect you to support any of his endeavors going forward after this?

Another option is to pursue hard money, and show him how much more it's going to cost "him" to do it that way.  

@Chandra Whittaker

County tax assessor will deal strictly with property taxes.

You'll want to talk to a tax CPA/EA for the tax ramifications involving the S Corp.

@Chandra Whittaker

As @John Woodrich has already hinted at, you'll want to talk to a tax CPA/EA before you make any steps towards quit-claiming the property into the S Corp.  There are serious tax ramifications to contributing appreciating assets like real property to and distributing from an S Corp that need to be considered.

It's a lot more complicated from a tax perspective than your banker probably knows or cares to know...

@Chandra Whittaker First off, I am sorry for your problem in getting your spouse to support your dreams.

All the analysis and advice posted miss an important point. The necessity of obtaining a spouses signature in a community property state, such as Texas, is not a “technicality” as previously stated. Although you owned the property before marriage, the assumption is that the expenses, such as upkeep, repair, taxes, insurance, etc will be paid out of joint funds. It makes no difference whether you earn the money or your husband does that pays these expenses because all money earned during a marriage is community property. As an extension of this theory, if you were to divorce, you would be entitled to the value of the property on the day of your marriage and your spouse would be entitled to 1/2 or the property value appreciation. So, in actuality the previous posts claiming your spouse has nothing to lose by signing are incorrect; if you lose the property to foreclosure he would lose his right to half the appreciation.

That being said, I will also tell you that the advice given by your real estate attorney about deeding the property over to an entity you owned prior to marriage is incorrect. The same way that the bank insists your spouse sign off on the loan, the title company will insist that your spouse sign off on the deed transfer because the transfer is occurring after the marriage. In both cases your spouse has a potential future interest in the property via appreciated value.

One final note consists of the fact that you have declared this property your homestead but do not live there. In Texas, a homestead exemption requires an affidavit that this property is your primary residence, not that you currently reside there. So one can reside somewhere else, but if their intent is to eventually make the property in question there primary residence, and they have no other Texas homestead exemptions, then they have not committed fraud. As a practical matter Texas only enforces that you have only one homestead exemption, the state does not do any checking as to where you actually live. The decision to homestead a property you do not reside in and do not intend to reside in is between you and your conscience. Since intent is very difficult to prove it’s basically the honor system. The reality is that in Texas everyone is entitled to ho Estrada’s one property.

One final note. If before marriage you had a prenup stating a division of property AND earnings, then your property and income would truly be separate and there would be no need for your spouse to sign. However these are difficult for two reasons. First, your spouse would have to sign a document AFTER the marriage stating that he still wants the prenup asset and income separation to exist; secondly you would have to maintain two completely separate financial lives and prove you have done such for the institutions in questions to not require your spouses signature.

@Chandra Whittaker, the problem with a Sub S Corp is that it is primarily for short term high income things like flipping properties as you can pull some of the income out as wages. An LLc is usually better for long term rental units. Also any transfer out of the S Corp is a taxable event. This is NOT an area I know a lot about, but I made that mistake because an older more experienced lawyer made me a deal to buy his Corp instead of form an LLC.

I do have more advice that is probably of less value, as I know less about it and it is all opinion.

First you are clearly a good person trying to do a good thing for your future and that of your children and family. It sounds like your husband is a good person too. You don't need to apologize for not knowing everything. I am an attorney and was one when I bought a Sub S corporation instead of going with an LLC. We all live and learn. Your family would be very proud of you if they understood how hard you are working to help them out financially. We all fear taking risks, it's just that some of us overcome that fear because we want to improve our position and the position of our family financially. Your husband has the right to explain to you why he doesn't want to sign, and you have the right to explain why you want him to. Seek to understand before you seek to be understood. It will help. You are taking on a second job by investing. You value him enough to commit to sharing your life with him, but you did not commit to give up your life to satisfy him. When we overcome fear we almost always think looking back, that really wasn't so bad, but the fear before we overcome it is real. You may know that snake is a harmless bullsnake, but the fear it engenders in some is real even if they know it cannot hurt them. Keep that in mind. Best of luck. I think it is admirable that you are working so hard and trying very hard to get the tools to allow you to keep helping your family as best you can. The easiest thing is just say OK dear and give up, but you are willing to go farther because your desire to achieve and your work ethic keeps you at trying to find a solution. Again, best of luck and please let us know how it comes out.

@Chandra Whittaker Get your husband to read all of our replies. Get him to understand that you aren't alone when you make these investment decisions. If you have to move ahead with a higher rate, that is better than not taking action, as long as you are still making a decent profit.

Thank You Toby, I will consider that.