All Forum Posts by: Jeyo Punnakottil

Will you do business with a wholesaler who wants 5k Ernest money check in her LLC name to lock up the deal.Never done business before with this wholesaler but the deal she brought is a sold flip with 30-35k profit

Some red flags from her side

1.Hard to get hold off using the business number she mentions in her email blast but finally gave her cell # once i got hold of her and  said i want to lock in the deal by doing deposit.

2.Claims there is an open house showing next tuesday but if i want she can cancel the showing if i accept the full wholesale price of 165k and do the 5k earnest money deposit check in her LLC name

3. She says she will not get keys to ppty till tuesday so i cannot see the ppty till tuesday. I have to run numbers based on photos that she send.

4.I asked her to send me the contract for my attorney to review, she sends me the assignment contract between her LLC and ME (1PAGE DOC)but doesnot send me the original contract between her LLC and the SELLER.

I really need an investor friendly tax person /Cpa in Houston .Any recomendations ?I am in a serious situation .Filled for an LLC in state of Texas using Incfile .LLC was created to keep a rental ppty ,but currently the ppty is still under personal name because no lenders would refinance the rental ppty in an llc name .In a nutshell the LLC holds nothing .But here in texas we have to file franchise tax .Complicated topic. I efiled for zero frachise tax .As of my knowledge the rent collected is included(filed) with federal income tax return and LLC is a pass through entity. A few weeks earlier got a TEXAS SALES AND USE TAX PERMIT come in mail.Not sure what it is .Now i got invoice from comptrollers office saying the LLC owes 1000,s of $$ in Back taxes .Cant figure out what on earth is happening .

@Melanie Liu

This issue is happening a lot in texas .I have a relative of mine who went through the same issue.Got into contact with builder jan 2021 .Closing date April 30 2021. Builder was dragging their feet.Didnit even start construction till March .Finally came back and told they need to cancel the contract because of high cost of materials or pay 100k more for the house.Builder had their contract written in their favor that they could cancel the contract so finally ended up paying more. I would advise consult with a realestate attorney and fig out how the contract is written.Does the contract have any clause stating the builder can cancel any time.If so what is the compensation . Else you know the back end ,your attorney will take care of this.

Also keep a documentation for any conversations with the builder.Always do email follow ups Builder wont respond via email,because they donot want proof of what they said but even if the build is talking to you via phone follow back with the builder via email stating AS PER OUR CONVERSATION TODAY VIA PHONE THIS IS WHAT WE AGREED OR.. THIS IS A BREIF FOLLOW UP OF THE PHONE CONVERSATION WE HAD TODAY, in that case you have proof to show what the phone conversation was and that builder didnot respond to your emails.

@Theresa Harris

I agree to sticking firm and not dropping the contract But you cannot threaten the builder about getting the attorney, any word with the builder about the attorney and they will stop communication with you and say their legal team will contact you.They know the game.They been in business for long and build 1000s of houses.They have their cards in order and have a full fledged legal team.So donot pull out that card infront of them.Instead i would advice find a good attorney that specializes in real estate . Have that attorney review the builders contract and ask the attorneys advice for the next step.Its worth paying the attorney a few 100$ if you want this to end properly else the builder is going to win .

@Joe Splitrock most lenders wont let you close a loan in an LLC @ first so there is no option left but to close the loan in your personal name and then quitclaim the ppty to an llc.I was scrambling a yr before with this issue went to 8 lenders no one will close the loan in an LLC name.How can it be be justified @ this point that corporate veil is piereced.Then that means there is no way asset protection and bankers are purposefully pushing you to do it.I am not a lawyer ,this is not a legall advice but just sharing my thoughts.

@Shyam Panchal

It all comes to Cash flow .If you are buying this ppty as a rental i would look into is this a killer deal to pass.From the conversation it seems you are buying a top of line ppty which has some minor and some major issues .Any one can say donot pass it on ,it is hard to find pptys as it is a sellers market,that doesnot mean you have to buy a rehabbed ppty (possibly a lipstick on a pig) and then throw money @it again if it is a skinny deal.A NO DEAL IS BETTER THAN A BAD DEAL.

Water heater i would not worry too much will cost 400$+Labor

The AFCI needs attention bcoz in most cities in texas a remodel will not pass city rules if a new breaker box is not installed ,try negotiating with seller on it.Either he puts afci or you get a reduction .It will cost 1000$ + labor

Mold is a concern.How was it fixed ask if they got professional remediation.Ask to see proof.If proper mold treatment was not done and you do like someone said just brush it off with vinegar or stuff you are on the hook if your tenants get mold in their system.Now it is on you to professionally remediate mold for your tenants (expect couple of 1000$) else you are looking @ a lawsuit down the road if the tenant know what they are doing and trust me tenants will

If you have inspection contingency on your contract i would fig out how much the repairs cost and negotiate based on that.

@Shyam Panchal Hearing your side gives me the impression that this is a lipstick on a pig kind remodel.If you find mold in a fully remodeled house that means they did a sloppy job.They didnot do a mold remediation.Mold remediation is a costly process and all they did was paint over the mold wich is an easy peasy.Like some one mentioned everyone and their uncle are into flips .Did you waive inspection contingency?

@Mrinal Parashar.Great strategy.Thanks for sharing.