All Forum Posts by: Fabiola F.

Hi @Nasir El Ameer! Land trusts are used everyday. What's your perspective on why they're a hassle? 

Also, as mentioned, the property has already been refinanced with a traditional loan...it was refinanced out of an LLC into my name. So my question isn't about future refinancing but about liability/anonymity/asset protection.

I own a vacation rental property that I had to quit claim out of my LLC into my name when I did a cash out refinance. So for asset protection & anonymity, I'm considering transferring the property into a land trust. Here's the 3 scenarios I'm considering:

1 Is the anonymity protection a lost cause at this point since ownership has already been exposed and title is now in my name since the refi?

2 Regardless of loss of anonymity, is it still worth transferring into a land trust for asset protection and especially since it is a vacation rental and I need protection against liability?

3 Would an umbrella policy be sufficient without the land trust and provide me with the protection & liability coverage? As a side note: there's significant equity in the property.

@John Corey I really appreciate your perspective. This definitely changes my analysis of the opportunity. Thank you. 

@John Corey Does it adjust your perspective the fact that the remaining 60% of the condo units are owner occupied? For clarity, only the batch of condos are non-owner occupied rentals. And yes, the intent is to resale a few at a time instead of going through the time it takes to sell 1 unit at a time.

@John Corey It's a collection of condos in one complex with individual titles for 100% of each of the units. The remaining units are individually owned. 

@Danielle Wolter Resale would be to owner occupants and not other investors. As mentioned before, NOI is very healthy and would justify a long term hold if needed, but resale within 2 years would be the end game on this deal so long as market conditions are still favorable.

@Greg Dickerson Good idea about the special assessments. Deferred maintenance isn't significant and the HOA has been doing a lot of updates to the building. So I feel confident about that part.

@Ameet Mehta Rent increase is based on current market rate and a survey of tenants on how much more they would be willing to pay with certain upgrades to the units (i.e updated baths, stainless steel appliances, granite kitchen etc). Even with out the rent increase NOI is about $150k. So the rent increase is a bonus.

I own a vacation rental property that I had to quit claim out of my LLC into my name when I did a cash out refinance. So for asset protection & anonymity, I'm considering transferring the property into a land trust. Here's the 3 scenarios I'm considering:

1 Is the anonymity protection a lost cause at this point since ownership has already been exposed and title is now in my name since the refi?

2 Regardless of loss of anonymity, is it still worth transferring into a land trust for asset protection and especially since it is a vacation rental and I need protection against liability?

3 Would an umbrella policy be sufficient without the land trust and provide me with the protection & liability coverage? As a side note: there's significant equity in the property.

I'm considering the acquisition of a batch of rental condos from a single owner with about 40% ownership of the total number of units within the condo bldg. The batch has significant NOI with immediate opportunity to increase it by 25% with less than $200k in rehab.

Pros:

1 Strong cash flow as is and rent premiums make it that much more attractive.
2 My end goal would be to resale the individual units to cash out.
3 Even if the environment for resale changes, there's still upside from rental income to hold on to the asset.

Cons:

1 HOAs can be a pain and could enforce restrictions that make it tougher to rent to new tenants or sell the individual units all at once or since.

2 Since this is just fractional ownership with the remaining owners owning individual units, the value & marketability of my units could be affected by the actions and upkeep of the other units.

Are there any other cons that I should consider besides the ones I have already listed?