All Forum Posts by: Handel Carter

Hello bp community. I'll get straight to the meat and potatoes. Formed my holding company. For my first investment, I was hoping to quit claim, warranty deed or flat out buying a 3 unit property, from my mother, that has about 25k left on the mortgage. The plan is to get it as a solid first asset to the LLC and use the appraised equity for either a line of credit or pull out the equity to do minor rehab to the property then use the rest to continue acquiring property. If purchasing outright through financing, it will be for the remaining mortgage price, which will leave me with about 40k equity and a crazy low mortgage payment. I spoke to a private lender about my intentions and he said he's never structured a deal like this. That is mainly because my mother is a 1% stake holder in my company. So it will be like she's selling the property to herself. Is that so? Is this really a problem? Is there a simpler way to go about this? Thanks for the read bp.

The feedback from all of you has really got me thinking. Very very much appreciated. 

Any thoughts on working with a private lender and flat out buying it for the 25K and then taking a line of credit on the appraised equity? Is this the simplest route?

Originally posted by @Bill Gulley:

A J Beard mentioned, Quit Claim Deeds are not for sales of any kind!

Thank you for all the valuable info. I do plan on having my mother as a 1% interest holder in the LLC. Do you see any problems with this? From what I've read, this would help with the title issues you're speaking of. I may also go the route of just purchasing the properties from her outright.

I also thought it would be a good idea to ask the questions on other threads but didn't know if that would be like spamming the community.

Originally posted by @Jeff B.:

QC is effective in changing title recording, but can create other issues that you need to become well versed in BEFORE to use this approach.

Issues can include:

• loss of title insurance if there's a change in the owner
• can invoke Due On Sale
• can create a taxable event if new persons appear in the Grantee

I'm not giving legal advise but you need to seek and discuss with a qualified lawyer.

Thank you for your response. I do plan on consulting with an attorney after I've figured out the course I'd like to take. Speaking with a former agent I know, I was told that taking out a line of credit would be the best move. The rates are supposed to be in line with an FHA loan. She said that I would have to wait 6 months after the QCD is filed to refinance, if I were to go the conventional route.

So my further questions would be:

Would you also recommend the line of credit route? I would use it to make the necessary improvements to the properties as well as to acquire more properties.

New investor here. Would very much appreciate any advice on how to go about getting the most out of quit claim deeds. My mother currently has two properties. Her own and a rental. She doesn't want anything in her name any more and is looking to move away and rent. We are thinking about doing a quit claim deed on both to my holding company. I will be forming LLCs for both. There's about 25K left on each individual loan with around 50k in equity in each property as well. Each property could use about 10k to get them where they need to be to get max rent for their respective areas. 

I've never dealt with quit claim deeds before, so I'm just trying to get any tid bits of knowledge, advice, strategies or warnings that this community may offer. Ideally I would like to use these two properties the most efficient way possible to begin maximizing my portfolio growth.

Thank you all for taking the time to read.

Originally posted by @Christian Bors:

@Handel Carter

The local REIA Group CARPOA meets the first Thursday (7pm) of every month at the Giant 2nd floor in camp hill. Come check it out, its a great place to network and learn. We have speakers that cover many topics such as taxes to landlord law and everything in between. Good luck!

Thank you Christian. I've been trying to make this, but my hectic work schedule has gotten the better of the situation.

I'd also like to thank everyone else for the Welcome to the community.

Chad Jarrah William Hochstedler Hello fellas. I worked at one of he bigger pa foreclosure firms a few yrs back. The upset price as explained to me, is the price that the bank gives out attorneys. At the auctions, the attorney would keep bidding until set prices is reached, as the bank would be "upset" with anything below that. A fair bit of the time, we would return from auction continuing to owning the property because there were no bidders willing to get to that range.

Originally posted by @John O'Leary:

Welcome, @Handel Carter, to Bigger Pockets!

 Thank you John. I appreciate it. 

Originally posted by @Kyle McCorkel:

Welcome to BP from Hershey!

 Thank you Kyle. I read your profile. Looks as bough we have similar goals. I'm 31 and would like to retire in 10yrs or less as well. I would also like to do primarily buy and hold properties, largely consisting of multifamilys.  Hopefully we can do some work together and help each other reach our goals sooner than later. 

Hello bp community. I'm new to the REI but very excited about the opportunities ahead. I'm currently in the process of forming my holding company. Just wanted to say that I've been reading your posts and correspondence thereafter and I'm taking in so much. Can't wait to interact with you all more when I actually have something of substance to share. I wish you all a strong year of business.