All Forum Posts by: Duncan Taylor

They are special kinds of trusts. You can't do GRITs any more. Congress closed that loophole in 1990 and opened up the one allowing GRATs and GRUTs.

Here is a write up on them from actual attorneys...

http://corporate.findlaw.com/law-library/grits-grats-gruts-what-estate-planning-beyond-the-basics.html

Max, if someone is predisposed to deceiving or cheating you then you wouldn't want to do business with them in the first place.

You are looking for a long term relationship with your buyers if I understand the model taught about wholesaling. If someone screws you over on one deal, you just won't work with them on the next.

Yes, WA in general is a lot more left leaning than it was in my youth.

If they pass something like that and it is held up in court, all that will happen is landlords not wanting to participate will just raise rents as much as the market will bear and push them out of reach of most S8 tenants.

Then the next push will be for rent control.

For the life of me I don't understand why this is not the 'normal' way people are taught to do this type of transaction.

It is clean and 100% ethical. With an option you do have an equitable interest in the property. You can record your option at the courthouse if you want. You don't really have an equitable interest in the property with an agreement to purchase.

I would think it is an easier conversation with the seller too...

"Mr. and Mrs. Seller, I love your home. I would really like to help you and this is how I do it. I am willing to pay you $100 cash, right now, for the right to buy your home in the next 30 days for $xxxxxxxx. I think I can find someone who is a perfect match for your home. If they are, I will assign the option to them and they will be the ones who buy your home. That $100 is yours to keep even if I don't buy it or find someone to buy it in my place. This is not earnest money, you can take it right now tonight and spend it on dinner out if you want. Can I pay you $100 for the right to buy your home in the next 30 days?"

If they say yes, you can assign that option to whoever you wish under whatever terms you and the replacement buyer agree upon.

I just don't understand the need for all the obfuscation, double talk and weasel clauses in contracts.

@Eric D.,

I have two suggestions for you.

First, never be pressured to alter your metrics just because someone else is willing to overpay for a property. Run your numbers, make your best offer and be prepared to move on.

Second, on the ones you lose, go back and try to figure out what you missed. Was that higher price really justified? Was tht the case based on information you didn't have or overlooked?

If you do both of those systematically and consistently, you are going to find they are usually overpaying without there being a sound business reason to do so. Keep a list of those properties, they will probably return to the market in the future with extremely motivated sellers.

@Dana R.,

Unless you have a long waiting list of tenants as good or better than this one willing to immediately sign a lease at the higher rent. And take the unit without any major repairs, follow the advice given above and keep this tenant.

You will lose more than $3K if this tenant leaves because of the time needed to turn it over and get a new tenant in there.

With good stable tenants we have sometimes gone several years without a major or any rent increase at all. You don't have to squeeze every possible dollar out of every single tenant to be successful.

Now, if you said you were losing $250 each month at the current rent. This conversation would be entirely different.

@Joshua Gordon,

Which version of Zoho are you using?

I do not know anything about it but I am meeting with my tech guy tomorrow to review the customizations he is working on for our new CRM system. I know he has worked with a lot of the ones out there, I will ask him if he knows how to customize Zoho.

I have money now but I grew up broke in Tacoma. My family carried a 'name with history' from Scotland but someone else got the money. My parents struggled just to keep us fed, clothed and housed.

One of the best days of my life was when I was able to sit down with my parents and show them how from that moment forward everything requiring money was no longer a worry. I guess the reason I view risk the way I do and manage it the way I do is because of the way I grew up. We are the sum of our experiences.

I was definitely S8 ignorant when I first started buying outside of WA. I had never had an applicant even ask me about the program before. I decided pretty quickly it was nothing I wanted to have anything to do with.

I know some swear by it and make more money with it than they would without it. But I've always followed a moderate path between maximizing profit and keeping my sanity.

As we grew as an investment group, I couldn't justify having people who worked for me do something I wasn't willing to do. So, we just never got sucked into the S8 underworld.

Most people solve this with a CRM (Customer Relationship Management) system. When you buy a new list the names get loaded as leads and automatically matched against those already in the system to prevent mailing to those who've asked to be left alone.

You choices range from free to expensive.

Probably not over a W2. I honestly don't think you have anything to worry about.