All Forum Posts by: John Pruner

 It's funny you say that - that's what the calculator was showing me would take 9 years to re-coup. But now the calculator is showing 30 years. I was going to choose that option. Now I'm considering the 15 yr mortgage - any thoughts on whether to pay points for that? There are actually lots of points options. I didn't list them all. I was leaning toward the 15 yr 3.375 since it seems more efficient than paying more points. Here is the full

Hi,

I'm not sure if this is the correct sub-forum for this question, but can someone give me some advice about whether to pay points?

The loan would be $42,750 for 15 or 30 yr fixed. Assume my marginal tax bracket is 28% and I could earn say 6% on money I don't spend on points. Assume annual taxes $500, annual insurance $700 if that matters (a calculator asked me for these #'s I suppose to calc total monthly cost)

Rates:

30 yr, .125 pts, 4.375%

30 yr, 2.5 pts, 4%

15 yr .5 pts, 3.5%

15 yr 1 pts, 3.375%

Knowing the break-even point would be nice.

I tried to use a calculator that I googled but it's showing me different results than it did a week ago so I'm not sure whether to trust it (or maybe my inputs were wrong the first time - not sure). So I'm looking for a 2nd opinion. The first time that I ran the numbers for a 30 yr the calculator told me break even was about 9 years on the higher points, lower interest rate option - but this time it told me 30 years so I'm not sure which is correct.

Thanks

Hi,

I have a few LLC-related questions.

If I own a house with a mortgage, is there any easy way to transfer that house into an LLC?

If I go to a bank for a mortgage on an investment property that I want to purchase, will they underwrite in the name of the LLC using my credit if I'm full owner of the LLC? What about if I'm only part (but majority) owner?

If I'm a partner in an LLC (majority owner), and the LLC owns a house outright (no mortgage), how do I get a bank to give me a mortgage on the house to get some cash out? The house can't come out of the LLC btw because the other partner in the LLC owns 30% and would obviously want to keep the house in the LLC. If I get cash out via mortgage I might decide to leave it in the LLC, or I might decide to take it out of the LLC but that's a separate discussion which would also include how the mortgage is paid in each scenario.

Thanks for any insight/help here - it's a bit confusing.

Thanks Jon. I think that I have found a good CPA in Greeley to handle it but if I have problems I'll ask you for that referral.

It seems like a lot of trouble and expense to set up an LLC in Indiana to hold a property there. Is it worth it if I have a personal umbrella policy? Do you generally recommend putting every investment property int its' own LLC? I've got no sense of how this is generally done by experienced investors.

Thanks for the replies. Let me try to make sure I understand.

I live in Colorado. I have an LLC registered in Wyoming that owns a property in Indiana. Will I pay state income tax on the rental income in Indiana or in Colorado or in both Indiana + Colorado (double taxed)?

Hi,

If I buy a small buy-and-hold SF property, what is the reason to do it through an LLC? I guess I can deduct depreciation and write off mortgage interest whether or not I use an LLC. However maybe I can only deduct something like gas to visit the property if I have an LLC? Is that why you'd use an LLC? And also if there is some liability the LLC would shield me?

My next question is whether there is a reason to form the LLC in a no-personal-income-tax state like Wyoming? I live in Colorado. Let's say I purchase a property in George or Michigan or Indiana and my LLC is in Wyoming. Is there any advantage to me?

Will I have to file a personal income tax return in each state where I own a property? In other words if I own a property in Utah, and another in Michigan do I have to file tax returns in those states to report my rental income there?

Thanks! :)

Hi,

If I'm thinking of doing a partnership with someone on the site, how can I ask the community for feedback about the person? What I mean is - I'd like to find out if anyone has bad experiences with this person. I asked him and he's fine if I ask the community but can someone let me know which forum or method I should use to ask this question to gather feedback (if there is any)?

Thanks

Hi Ali, I'd probably be fine with notes. I'm not sure of all the options out there.

Thanks

Thank you for the further replies. Good tip about buying a house on a slab - I like that idea.

Brant about your question (paraphrased):

"Where do you plan on moving? Is it a good rental market?

How soon is retirement? One thing to consider, lenders like to see income. It will be easier to get loans before you retire. "

Retirement is 3-8 years away. I am considering my retirement options at this point so am not sure what sort of market it'll be, thus I don't want to get entangled in a "boots on the ground" sort of commitment until I figure out where I will be located.

I do have a good income to go along with my excellent credit, so I hope to leverage those 2 things to get some leverage for good solid deals in the next year or two.

Thanks! :)

Thanks very much for the great replies. I'll quickly answer a few of the questions that were asked.

Q: How liquid do you need your investment to be?

A: I can afford to have the investment tied up, it doesn't have to be liquid

Q: Turnkey due diligence?

A: Thanks for the suggestion - I will definitely try to do due diligence. My worry would be that I'm not experienced enough to do accurate due diligence. But yes I will certainly try.

Thanks! :)