All Forum Posts by: Chris Weiler

Page, you are right, you have to be self-employed to partake in a SD 401K. But, you could also have a full time job and a part time self-employed business on the side. You may not be able to contribute much to the 401K, but if you have a large chuck of change from a previous employer, an SD 401K may be a better option than an SD IRA.

I have seen a few blogs (not on Bigger Pockets) for this with no references. Apparently on January 18th, Fannie and Freddie announced changes to title transfer requirements. The new requirements are:

The buyer is prohibited from selling the property for any sales price for a period of 30 days from the date of the deed.

After a 30 day period, and until 90 days from the date of the deed the buyer is further prohibited from selling the property for a sales price greater than 120% of the short sale price.

The above restrictions will run with the land and are not personal to the grantee.

Can anyone confirm this and/or possibly have a link to a reputable source?

I will throw my vote in for the Roth 401K option as well. I took the plunge last year and converted over to a Roth 401k (with Steven Hamilton's help, thank you Steven!). In addition to the benefits described by Will Barnard, with a 401K you don't have to deal with a custodian and you can often use leverage without taxation (UBIT).

As stated before, you will need a business to be able to open a self-directed 401K. But, it does not need to be an Inc. or LLC. Anyone can create a simple sole-proprietorship, open a bank account and use it to start a 401k.

Does any of this apply to NOO? It is my understanding the Safe Act only applies when a homeowner is involved.

I would just deed the property over to the LLC. A rehab flip is such a short period of time, as long as you are making your payments on time the bank is not likely to find out or do anything about it.

There is another option if the rehab turns into a rental property or if you are just really paranoid about the bank finding out about the ownership change. The other option is to deed to the property into a trust and then transfer the beneficial interest into your LLC. It is my understanding "due on sale" clauses do not pertain to transfers of property into trusts.

Michael, it looks like the system works well for you. As much as I would like to implement that, I have too many properties with the same rent amount. Also, if a tenant makes a payment higher or lower than their rent, I still may not know who it's from. I'm also sorry to say some of my tenants can't be relied upon to write anything descriptive on the deposit slip or send me a copy.

For those of you who set up bank accounts were tenants deposit cash, how do you know which tenant made the deposit?

Bryan, I went to the one in Vegas in 2010. It was worth the time and the networking was excellent. I am considering going to the one this year in Fort Lauderdale. I have a number of new connections in Florida and would make a dual purpose trip out of it.

David, it is probably not worth it for one entity. But if you have multiple properties it might make sense. It might even make more sense if you incorporate a series LLC with it. I would assume the structure would also avoid the CA gross proceeds fee on LLCs since it is the land trust, not the LLC, running the business.

Setting up a land trust, LLC and mailbox are pretty straight forward. Not sure why you would assume you would be required to use the authors service. On the other hand, he is a competent real estate attorney, so it might be a good idea.

Clint Coons, who has contributed great articles on Bigger Pockets, has a blog post that address' a possible way for CA investors to avoid this. Is a great read at: http://clintcoons.wordpress.com/2012/05/11/for-california-investors-the-solution-may-lie-in-nevada/#comments.

If you are not a fan of copy and pasting web pages, you can find it by googling Clint Coons Blog and find the article, "FOR CALIFORNIA INVESTORS THE SOLUTION MAY LIE IN NEVADA".