All Forum Posts by: Colin Bochicchio

This sounds like fraud all over it and you are right a seller can not profit from a short sale against the law.

All monies and fess has to be disclosed on the HUD-1 as we all know at closing and I just completed a short sale on my wife's house. We had to come out as sellers with a contribution of x amount to close this transaction.
There are also if I recall other SS disclosures as well.

It could be a federal task force since I had seen them in LV where local police were working in with the federal district attorney.. You do not wish to go there.

I would report them to the authorities whether state or federal or the real estate commission in the state you are in.

Good luck on this..

All I can say is justice is served finally. :)
I knew of people who were killed in the attacks in NY originally being from there, so there is some closure.

I am very pleased they got rid of the body so he can not be martyred since it is like he disappeared since with all the unrest in the middle east we certainly did not need to add any more fuel to the fire.

My thoughts and prayers go to all the victims of what this man evil deeds has done.
Maybe we can totally win this war on terror and I think it gives the country some hope..

Just wish to make a quick few points here on this thread:

First off Mitch is correct you can absolutely grant claim deed/title to your LLC.
I would do that for a short hold maybe until you sell for example that would be fine and no legal advice intended. Even with the corporate veil in the LLC why increase your liability by deeding title to the LLC. ?? since IMHO LLC's were not meant to hold asset real estate that what Land Trusts were made for.
Please note I encourage the use of LLC's they are vitally important in your business.

As to the DOS yes this most likely would not happen but with a LT you would not even have to worry about it anyways. ( Reference: Garn St Germain Act of 1982 Section 8a).
What would be more prudent is to use a land trust and assign a % of beneficial interest to your LLC or C-corp etc and so now you have a layering of assets and a dual shield of asset protection and creating a basic asset protection strategy.
If a creditor did go after you they would have to pierce the LT then break a corporate veil which if any lawyer encountered would be a much bigger challenge to undertake. (Reference Kenoe on Land Trusts 1989) just so you know this ruling stops the partitioning of beneficial interest in a LT so a creditor could not pierce the trust with a charging order since other beneficiaries would be negatively impacted.

The worse case scenario would be the creditor can take that say 10% beneficial interest in the trust and they would not get paid until the property sold to cash out but the trust itself it NOT pierced and nothing is ironclad.

The LLC protect the LLC members form liability and the LT protect the "corpus" or real property.

Depending on your exit strategy determines the trust you should use and how it would be setup.

I use LT in my investing and honestly like the way they work when done right so just wish to chime in.
LT also work very well in multiple investor scenarios on property.
LLC and Land Trusts are like bread and butter they work very well together that is basically my point.

Mitch as to grant claim deed my understanding is you show proven reliable chain of title and that you have documentation you have the right of ownership. In a quit claim there is more liability due to not certain this person has the right of ownership to be able to deed a property to you so I would research that one.
Quit claims from what I have seen are mostly done in living trusts to heirs or when they wish to quit claim to family members in thus following federal law- Garn St Germain Act..I realize investors use quit claims to deed to other parties but as to it being a arms length transaction..??

If I can help please feel free to email me...

Michael,
I am going through a short sale on my wife's property in AZ and I feel the same way and I emailed her to discuss some viable marketing strategies since we are going little if any foot traffic and we lost a buyer previously due to the buyer lease expiring and he could wait no longer to close so that was quite upsetting to see happen.
She has a great web site with even better pics and she told me to let her do what she does best so I may have to trust my realtor since I live in VA so I'm on the other side of the country.
She did not like the fact I had questioned her marketing strategy since she feels the website is top notch and the fact that realtors do not do "open" houses anymore..?? since I suggested can we do an open house.. we are getting some hits off the website though..
AZ is real slow especially this time of year so what can you do..??

I am using a law firm and suggest you do as well especially, if you have a 2nd lien due to the potential recourse on the loan and make sure you have a short sale approval letter available. No legal advice intended on this.
All I can say is be involved in the process and be reachable for development that come along.
If you can maybe you could funnel any investors over to your realtor.

Either way the best of luck to you hope it works out..

Colin

Will,
Good post and great thread on land trusts.
I personally have used Bill Gatten's method being the Equity Holding TRust to invest.
Randy Hughes is an renouned expert in how he does his system as is Bill Gatten.
I like the benefits of using them and how we can effectively emulate any type of seller financed transaction and do it safety within the land trust.
Wholesaling is a great way to use them to also avoid the seasoning requirements as well as what you mentioned.

Whether it is Bill Gatten or Randy Hughes to Mark Warda to Jack Shea among others they are the experts who know their stuff on LT usage and investing..
Bill Exeter as you may know is the national expert on 1031 exchanges so another powerhouse in the real estate legal industry so what a thread!!!

Anything these gentleman say I listen to intently
Will, you are right LT are not a bunch of muck if used properly and if you know how to use them effectively in your RE investing strategy..

Happy New Year 2011 to all!!!

KC,
I would like to learn more of this type of entity structuring method you outlined.

I work with land trusts in my investing so familiar with title holding trusts.
Can you do this nationwide under federal law or only under the particular state you are in. For asset protection if it is legal it sounds interesting for investors who really wish anonymity..
Typically, the LLC is assigned a % of beneficial interest in trust so you are layering your assets in the investment..
Feel free to call or PM me to discuss further.

Happy New Year for 2011..

Great posting forum on this topic and I think it goes for any seminar training company not just Rich Dad training.

I believe in helping or working with and investor and making monies in the deal or transaction and yes training is important thing to budget but putting one in financial straits on training is not IMHO the way to go.

If investors or training is confident yes pay a reasonable fee and the monies should be make to pay back the training in the actual deal you do and make monies and maybe do a split 50/50 so really you earn when you learn literally..

I have made my share of mistakes and agree knowledge is needed and as one poster stated networking is the key in this business..

I use a specific system of investing and if I work with somebody who can help me I train them as part of the deal so they are knowledgeable as well.

Good investing to all..

Daniel,
I just left Tuscon 2 months ago and that rental market is soft there as you know.
I am in the middle of short saleing my wife's home and it looks good but we are underwater some 100K easy.
I think it is time to have your "friend" pay you for your time and services. Friends and business typically do not mix and he is taking advantage of your friendship.

What type of agreement do you have and I would re-negotiate and honesty if he can not pay I think he should make you a partner or give you some ownership for payment whatever is equitable.
Maybe you can get a bigger payday down the road..??

If he does not wish to negotiate and does not pay you as agreed you can try to get an attorney for small claims due to non-performance ( no legal advice intended) so check on your options.

I believe if you think you can help and you did put in all this time to manage his property he should do an equity share arrangement IMHO..

I know when my wife and i considered a property management company the terms were not negotiable for the services rendered they get their 11% fee off the top...:)

Either way good luck

First thing is obvious legal advice needed on your entity structuring I.E managing LLC to manage your operation.

I agree with your statement on assigning the % of beneficial interest to your LLC which does provide a good degree of asset protection ( no legal advice intended just my suggestion) since I work with land trusts and that is the preferred way to do this and you are effectively "layering" out any potential liabilities that is why land trusts and LLC or C corporations compliment each other so well.
It is better to do this when the trust is created then to have to go back and do it just cleaner that way.

In how we work with land trusts we use a corporate 503 (c) trustee corporation, who does all the trust administration so a management company really can not be used since it could invalidate your trust since the trustee performs a free collection service as well in their duties to the trusts beneficiaries.

I would IMHO, separate an LLC to do the collections or use another licensed bonded company.
The replies seem to be great advice since you would not wish to be commingling assets and you would want accurate management of your properties.

Typically in a trust the tax burden falls to the trust beneficiaries and if you have a professional trustee you should have all tax statement from him on the payments received for tax purposes..

Your estate planning or RE attorney should be able to structure for you a viable solution based on your tax structure since that is involved.

Good luck to you..

Mark,
Sounds like a viable plan.. and it could benefit you in this business relationship yet make sure you can make some monies on this deal.
Make sure you limit your liability in your contract.
The issue with a CFD is verifying the lender is getting paid as you mentioned and if you have a 3rd party loan servicing company doing that you should be OK.

I would focus on trying to leverage a higher cash flow to make it more profitable for all parties in the deal.

You need a tenant with a buyers mentality that can put more down front end monies, cash flow and hopefully gain appreciation on the back end when the buyer purchases or refinances.

I will give you one example of how in a land trust we can leverage a higher payment. Find a tenant who can put good monies down and make a higher then normal lease payment for him to take an active tax write-off if the seller allows that this is all done under IRC 163 h 4(d) as a beneficiary in the trust..
We also use a triple net lease NNN so the tenant takes care of the property so no work needed on your part but you have to find the right tenant .. this is just an example of one possible deal..

Another reason I invest with LT's is to protect the title and all investors in the deal from litigation or problems.

I like the fact you have viable exit strategies very important in investing to have options..

I would much rather be a principal and be involved in the property if I did all the work since you could lose it if he decides to go with somebody else since in a trust you can NOT be circumvented in the transaction you would vote to the trustee so the seller has control and anonymity and believe it or not a degree of asset protection especially if he holds his beneficial interest as an LLC or C corporation ( no legal advice intended)

You can email me if you like to discuss but it looks overall ok I can not tell on the financing on the rent/lease amounts for the area or any other hidden expenses. There really is not enough information to determine is this is a deal or not..??

Is title policy current are there an liens on the property you are unaware of .. title check..etc.. so do your due diligence since you wish to make sure you do things as right as you can with full disclosure..

Good luck