All Forum Posts by: Colin Bochicchio

Manuel,
Just put in your offer/terms on the property and do it with confidence and yes after I'm sure several discussions with your seller.
Every situation is different and if the seller is having problems managing the property and does not wish to sell outright you may be able to partner with him if you have a way to make it cash flow or market it better etc.

If he wishes to sell and they all do then you can offer full price if you get the right terms for example,so you need to learn to negotiate that part.
Just remember you may not buy it but your associate or partner may so you need to show the seller you have many exit strategies to move his property to the right buyer.
You also need to show that you know what you are doing and that he will get paid each month on your seller financed arrangement until such time a buyer comes in with their permanent financing.

The idea is to protect his interest as well not just your own so the seller knows it will be a win/win transaction.

There are many ways you can structure seller financing on a case by case basis.
What is the property condition the rent rolls if commercial then the CAP rate, maintenance costs and so on. Are they currently rented with positive cash flow or are there vacancies..?? you get the idea.

Multi families when done right can cash flow for you.

You need solid numbers to analyze this to see all the numbers to make sure it works based on your debt/financing i.e avoiding negative cash flows..etc.

If you a real new to this I would partner with an seasoned investor who can walk you through the offer and how to best structure it.

Feel free to call or email me if I can help further.

I would have to agree with JScott since I always read his posts since he has real experience in his area of investing and others on this board even if I'm not working in wholesaling.
That old saying attitude determines your altitude goes a long way.

Whatever RE knowledge is imparted to you should read and appreciated from what it can provide since BP has some real knowledgeable members in different aspects of investing.
You should recheck your profile since it does comes off abit strong.
My area is land trusts and investing with them so if you need an information on using a land trusts to wholesale or whatever i can assist.

I wish you the best in your investing.. :cool:

JohnQ,
What I would possibly do is make it a non-exclusive offer/contract and I'm not a realtor, yet we use them in our way of investing that way if the seller finds a better deal well no harm no foul. It will show him you will perform or he can find a better deal so he does have options. If you do this get it legally reviewed for New York State..

That way in addition, there is no liability to any of the parties if you can not for some reason perform and doing it the seller may let you do a no money down deal and no legal advice intended.
If you have no skin in the game the seller may feel you may not perform as agreed.. etc..
Another idea is find a flexible realtor who would considering this type of proposal not many will who are conventional but you may find the ones who understand creative financing.

The other advice was right on show deals you have done to show a successful track record and that you have a team of professionals not just you.

If I can help further let me know John and cute baby..:)

ThomasK,
As to your question depending on the the Land Trust legal structuring will determine the protections. In the land trust I utilize we use Kenoe on Land Trusts a 1989 ILLINOIS ruling so there is a degree of asset protection.
This deals with the non-partitioning of beneficial interest since it is personal property not real property so the worse that could happen is a creditor charging order or judgment could take that one beneficiary's interest but can not pierce the trust to liquidate the asset. You can look up the ruling for more information.

If you are using a LT for a such a short hold what liability is there really..?? I would and no legal advice intended is to use the LT and hold your % of beneficial interest in your LLC and that provides very good degree of asset protection and no legal advice just my take on things.

Thomas K, an assignment of beneficial interest is first off a silent assignment and is a simple document in the trust to execute, so once again what liability are your referring to.??
As long as your land trust is setup properly you should be fine.
If you buy the REO property then you being on title are referred to as the grantor/settlor beneficiary and you assign beneficial interest to whoever you wish.
Just so you are aware the LLC protects the LLC members from liability in attacking them personally and the Land Trust protects the corpus ( real property) so they go together like bread and butter.
Last point is anonymity and privacy and that is what LT is really known for.
The LT is good since it can be used on a per property basis and gives you many exit strategies.
Selecting the right trustee is critical to your trust being legal and correct. That is why I believe using a corporate trustee is the best way to do it especially for longer holds on property.

The attorney we use to legally review these land trusts up that is all they do and do it on a national level so they review all 50 states state law as it relates to LT legislation to be in compliance. The reason why I use the Equity Holding Trust is it has never been pierced legally in 25 yrs of existence so to me that is impressive.

If you have any further questions feel free to call me or email me.
There are 30 actual benefits to using them so hit me up and I will shoot you the document to review.. :cool:

NickA,
Yes a straight rental will from what you are saying put you in the negative.
We can see a sale is out of the question.

I would consider doing a triple net lease N-N-N with a contractor type person or a maintenance/handyman type who you can share equity or appreciation with.

You can also actually let your tenant take the active tax write-off under the IRS tax codes as a beneficiary in your land trust..
This may just be a perfect scenario which is why I suggested it. Reference IRC 163 h 4 (d) and no tax advice intended so in effect you can charge him a higher than normal lease payment for him being able to take the tax write off on your property thus offsetting your negative for a possible positive cash flow. He of course would need to check his tax basis with his tax attorney or accountant and this is just an example.
There should actually be very minimal property management in the triple net lease arrangement due the tenant is taking care of the property for you in return for a piece of the deal..
Any monies posted by you and him if you split the work costs in the property are what we call refundable contributions to the trust since they are non-recurring.
Once you are setup there is a debt to income letter you can use so you should be able to qualify for 100 % DTI on your next property. This letter will detail the structure of the LT to your next lender.

Not knowing the market where you are you can conceivably hold for a possible turnaround so the longer the better.

I believe with the right tenant that can do the work for you hopefully you can turn it around for a long hold and capture back some appreciation.

There are many ways to structure this transaction just need all parties to be in agreement.

Let me know if I can help..

Good luck.. :cool:

JThomas,

On REO property once you do obtain the property from the bank via your cash offer you can either vest title to an LLC then sell shares in the LLC or sell the the LLC outright. IMO a better way is to setup a land trust and sell your % of beneficial interest to your buyer when he comes in with his monies at close of escrow and that echoes what JScott mentioned and I agree wholeheartedly.

You would however as stated verify your title/escrow company is LT friendly and basically that is a corporate trustee or whichever trustee you use is selling the property to a designated beneficiary ( buyer) via directions from the trust's beneficiaries that simple and the escrow agent would follow that direction as well.

I believe each transaction is different depending on what your escrow/tile company will allow so I would "pre-flight" the transaction to see what objections that may have.
Just make sure you have an arm's length transaction.

Mr Finance Examiner: Excellent reply on your posting on this.

Good luck. . :roll:

I would be interested as well Josh..

The real time exchange would be great connecting and learning..

David,
Actually the trustee would collect the lease payment and these trust only work in the US I don not how the UK structures their land trusts..

A land trust protects the title/deed due to the holds both the legal and equitable title to the property thus they own and you now are assigned a beneficial interest so you effectively control but own nothing.
That means a creditor can not look up your name on property you own and lien the title if they can it can prove to be very difficult to sell w/o settling the debt first and provide a clean chain of title.
You also have a degree of asset protection as well of the beneficiaries in the trust and I can on and on.

This is why a beneficiary in your property can NOT claim equitable interest due to the trustee has equitable title.
We take full advantage of US tax laws in how the trusts are setup..
We follow federal law..
Ralph: I appreciate your input on LLC's and aware of LLC setups and would probably do that unless it was an involved setup..thanks for the advice though.

The trustee is the management and collection company yet your LLC can also enforce it as well in being a beneficiary..
If you forward me your email I will send you the 30 benefits of using them in your investing.. a good read and no soliciting just wish to provide helpful information.

Do what is best for you I just wish to illustrate the advantages in using land trusts to control property..

Matt,
Yes there is more paperwork in getting setup but I believe it is worth it to avoid liability.

It really is very easy to do I just gave David some ideas in how we use LT to gain more advantages for all parties thus creative investing.

Typically when these entities are setup they are in autopilot and all you do is get your check from the trustee each month..
Insurance is something else entirely and yes that goes without saying a good policy is needed.

You need to protect the title from the lawsuit that hits you so you need good insurance and a LT IMHO to stop any charging order or threats to the property.
It is also nice to not have your name on the county records so you are off the radar screen.

I just went into detail to give examples of how you can remotely administer a property via your designated trustee very simple to sign off on one letter..??

Dave,
I just wish to say is yes absolutely setup your LLC and I suggest you also setup a land trust to asset protect the property and the deed/ title while you are away.

Just so you are aware in a beneficiary directed land trust the trustee via a notarized letter of direction would follow the instructions provided by you the beneficiary so from England you can direct the trustee easily and safely.

They also can collect rents or lease payment as a 503 (c)corporation.
LT and LLC's as I have stated on this board work very well hand in hand.
Laura had some very good advice on your LLC structuring.
Personally I would not deed title to real property to and LLC but rather I would assign my LLC or C-corp a % of beneficial interest in the LT.

This is really a basic asset protection strategy so you protect the LLC members and the LT protects the corpus. I do not believe in commingling assets plus you avoid a DOS which I know is a not going to happen but you know doing it this way it never can since you are following federal law specifically USC 1701 j d (3) or Garn St Germain Act of 1982 under section 8a.

No only do you get anonymity in your real estate holdings you get a degree of asset protection not ironclad yet nothing really is..
Most investors do not understand the distinct advantages of using land trusts in their investing there are actually 30 realized benefits if not more.

What you should also consider if you wish to leverage this property for the higher lease payment is you can do a tax lease trust and have the beneficiary take the active tax write-off following IRC 163 h 4 (d) and no tax advice intended and that is a tax lease trust since you probably wish somebody to take care of the property and a N-N-N lease would work very well in that case. Just a thought...

You have more strategies and ways to maximize your investment this way.

I work with LT as a principal investor but I see a LT in your scenario a very prudent move.

If you have any questions you can email me if you like.
Good luck.....