All Forum Posts by: Jeffrey Klawitter

The previous owners tax rate would go up  to the closing date on the house.  The new tax rate would start for you on the day of closing going forward.  You as the buyer got a credit at closing typically at a rate of 105% of their previous rate up to the closing date prorated and you are responsible for paying it.

Not to add to your things to be worried about but.

If it is a commercial repair garage during your due diligence period may want to get the soil tested for hazardous waste.
You definitively don't want to buy an EPA issue.

First off I am going to assume when you say trust you are eluding to a Land Trust not a Living Trust 

Everything below would be subject to the land trust.

The Annual cost come in when you have a trust company or Bank act as your trustee of the trust. As well as cost for any changes you may make through out the year.  This is by far the most professional way to handle the Land Trust.

As far as keeping valuable papers at home or electronically. These are both very dangerous.  Depending on where you may be in the united States there are fires and floods  Fires both natural wild fires and home fires,  Floods can come in many forms as well and then there are the other natural disasters. 

Electronic copies.  Have you ever lost any data to a HD failure computer crashes.  Do you really want to store that kind of document on the Web?  Will your heirs know where to find those docs, if god forbid something happens to you unexpectedly?

The trust company or Bank that you would be using as the trustee would be much easier to find, and will administer the trust as you would have intend for it to be.

I am not saying trust are bad they have their place just like anything else. I just have made a personal decisions they don't work for my situation.  LLC's is just much easier.  

@Frazer Joseph Gibbs.

Based on my research and speaking with my attorney deeding properties to a trust just adds another layer of complexity to the situation and additional annual maintenance cost that at least in my situation is not necessary. If you can put it in the LLC why bother with a trust first. Next big problem is if you don't use a trust company maintaining and safeguarding the trust documents becomes an issue. And should they go missing then you may have title issued. Just seems like more downside risks the upside potential.

@mark surdam

Per Fannie Ma Rules as long as those who are on the note are also listed as the Majority holders in the LLC you are all good.

It clearly state that in the link I provided earlier.  I had spoken with someone before that their Bank - Wells Fargo was giving them a hard time on it as well. They referred them to the same info I just shared with you and have never heard another word about it.

It seems every time someone talks about forming a LLC for their properties one of the first responses is to raise fear about the Due on Sale clause.

If you follow so really simple rules it can be done with no fear of the bank calling your note.

The following info is from FNMA themselves which is who is
governing your loan. Your bank needs to follow their rules.

https://servicing-guide.fannie...

Review this link for the specifics

Good luck on your real estate journey

Exactly, It does clearly say it will need to be removed from the LLC prior to any refinanceing and upon completion of the financing it would get placed back in the LLC

Fannie Ma is a Residential loan and since it is a 3 flat that is typically what you would be getting.
Your action steps to get the financing are.

1.Remove the property from the LLC and put in your name.  (just file a quick claim deed with the county or a warranty deed to be extra safe)  check with the title company this may effect your title insurance.
2. Obtain your financing in your name not the LLC
3.Quick claim deed it back to the LLC

Based on the rule from my previous reply this is allowed and the bank can not exercise the right to call the note on the transfer.

Option B
Obtain Commercial financing in the name of the LLC and close it in the LLC which will not have as favorable terms as the Residential loan.  Interest will be higher and repayment terms will be shorter.

@Mark Surdam
I hear and see this all the time and there is a big misconception on this.  The following info is from FNMA themselves which is who is governing your loan. Your bank needs to follow their rules.

https://servicing-guide.fannie...

Review this link for the specifics

Hope this helps

Thanks for your reply.

I just looked into Cozy and see they have been purchased by Apartments.com.

I am looking to make my rent collection become more automatic and would like the tenants to pay online vie ACH or other means.

Currently tenants write me checks and then I need to do the deposits.  This is not an efficient use of my time. I see there are several apps or services I could signup for to streamline the process.

I am looking for some of the communities experience on what works and doesn't work what you like or don't like and any recommendation you may have.

Ultimately what ever I choose need to be user friendly for both me and the tenants.

Thank you all in advance for your input and suggestions.

Jeff