All Forum Posts by: Jerry W.

@Gabriela Valdiviezo, good luck on your WY flip.  I just had my most recent flip go under contract this last week.  It was a joint venture with a local contractor/investor.  Hey to @Nathan Gesner and @Casey Gregersen.  I have worked with both of them and they do a lot of business in WY as well.  I hope everyone had a lot to be thankful for this last week, and have an even better Christmas.

@Marcus Auerbach Just a quick post. First court cases do not get a cite that can be looked up in my state unless they are appealed to a court of record. In WY that is the Supreme Court. The first case that comes to mind is what would have been a charging order protection case. The Defendant swerves out of his lane going around a corner and hits another vehicle injuring the plaintiff fairly badly. The Defendant owned 3 rental houses. He lost the case and lost the 3 houses to the Plaintiff. Charging order protection would have likely saved the houses if they had been owned in an LLC. However the Defendant did harm the Plaintiff fairly badly due to his negligence and should have paid. He only had $50K or liability insurance for his car.

Second case involved a slip and fall where the step at the end of the stairs was higher than the building code allowed, and the handrail was loose and did not hold up to the grossly overweight guy who fell. The guy who fell had a bunch of preexisting health problems, but suddenly the fall was the worst thing. There was an LLC in place. The owner refused initially to settle the huge claim. Just before trial the claim was settled for the maximum amount of the insurance policy. The initial claim was for millions of course. Would the lawsuit have settled if the property was in the name of the wealthy landlord instead of an LLC? How could you know that? In all honesty the vast majority of lawsuits are settled out of court by people who cannot sleep at night because of a case they might win, but the fear of going bankrupt or losing your life savings from a $10 million lawsuit makes them agree to pay the $400K or $500k settlement rather than risk losing millions. I really hate that part. Nearly any lawyer can grab $50K in even a bogus lawsuit just so the owner can sleep at night and the insurance company knows it is cheaper to pay $50K than to go to trial and win.

By the way all of the states I know of do not provide that the loser pays the winner their attorney's fees, that is the English rule, the American rule is each side pays it's own fees.  It is only in frivolous filings, when it is provided by a specific statute, or provided by contract that you get attorney's fees.  Divorce statutes, class action lawsuits, federal deprivation of rights, etc. are obvious exceptions.  Most personal injury cases are on a contingency basis.  The lawyer usually gets between 30% to 50% of the ultimate settlement, not an hourly fee.

I have read several cases where judges have denied causes of actions against people in their personal name because there was an appropriate LLC in place. I have no idea if the underlying action was still pursued against the LLC or who won that. Keep in mind WY gives a lot of weight to the use of an LLC and not all state courts are as good about it.

@Ian Lockwood, my email is [email protected], I would love to hear about the property in Wyoming.

@May Muuse, 2 houses at 900 square foot each, one at 1,000 square feet, and the last one at 2,000 square feet.  I have three that 2 bedroom 1 bath, one three bedroom, and one 4 bedroom 2 and a half bath.

@Henry Clark, I really want to thank you for your posts.  They show an amazing amount of insight and detail.  It is kind of you to share your knowledge accumulated the hard way, especially for free.  If you decide to wander through Wyoming, let me and @Nathan Gesner know.  We will buy you lunch or supper.  I really enjoy your posts.

There are a couple of ways to do this.  One is figure out the profit you would have made from your construction until it equals the cost of the 25% down payment, another is to simply pay the money guy back the 25% down from all profits then split after that, or even just split all profits from day one evenly.  There is no magic "fair" split.  What is fair is what both of you agree on at the time.  Make sure that there is 100% transparency on everything.  Call and ask about major decisions even if it seems petty, the other partner will really appreciate it even if he has no opinion to share.  It is really important that you cover every contingency you can think of in how you split profits and losses.  It is the unexpected or unplanned for events that are likely to cause problems.

@Andrew Naber, high end is relative I guess to your area. You can always experiment to find out. I simply put my listings on both sites and see how they shake out. I called my most recent STR high end because it had 4 bedrooms, not my normal 2 bedroom, it had more square footage, higher end furniture, and it was on a river front. It has an outside fire pit, higher end bedding, bigger kitchen, etc. It is nicer than most in my area, but not as nice as some. You can decide for yourself. Good luck.

@Jim Smith, welcome to BP bud. Just so you know, you can put your 25% into an LLC without the consent of any of the other parties. Just a thought.

@Andrew Naber, Welcome to BP bud.  I would just leave it on both sites for now.  When I started I got almost 90% ABB, but now ABB is maybe 60% and 25% VRBO.   I recently opened up a nice 4 bedroom house on the river with higher prices.  It is 80% VRBO.  So longer stays and higher end properties seem to do better with VRBO, smaller short term stays seem to do best with Air BnB. 

@Ki C Chan, you didn't give enough information for me to be of any help. If your only question is how to transfer the ownership of your LLC from you and your wife to your intervivos trust, the answer is to do a Bill of sale of your ownership in the LLC signed by you and your wife to the Trust saying in exchange for $10 and other good and valuable consideration, including for estate planning purposes we transfer our ownership of X LLC to to Mr. Smith as Trustee of the Mr. Smith Intervivos Trust dated January 10, 2023. Do a set of minutes for the meeting to keep in your LLC. The actual reasons and tax issues should have been explained and planned out by your attorney and accountant. You should understand why you are doing it.