All Forum Posts by: Joe Homs

@Linda West its your money and your time, but if you get an attorney involved it will not only cost you money but could also hurt the association that you are a member of.  Not many attorneys represent homeowners, because that's where they usually make their money from.

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@Harshal Gaikwad If you want liability protection then you will need to place the property in the Rental LLC which should be owned by your family living trust. Your attorney or Anderson can guide you best.

@Paul Novak you should reach out to @Dmitriy Fomichenko who is the expert in this field.  However, you can look at a self directed account for your 401K or the Roth contributions.  I use mine to flip properties and grown my retirement income.

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@Dylan Speer  

Couldn’t I sell for a loss, and pay the bank back whatever I owe them but borrow that amount? So rather than selling $10-15k of investments, couldn’t I get a short term loan to use to pay bank back?

Yes you can.

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@Harshal Gaikwad 

1. Step 1: We can move Title to our Rental LLC. Yes, but how long have you owned the property.  If you don't do it correctly the tax assessor may re-assess the property becuase they don't know you are the same owner.  on the (pcor) you need to check the correct boxes.

2. Step 2: We assign the Rental LLC to the Trust Yes, make the LLC owned by your living trust.

3. That's it - no need to modify the existing lease. The Trust owns the rental LLC, so we are covered.  Correct

Also, asking 2 additional questions:

A. Should I just send a ‘notice of ownership change’ to the tenants once step 1 and 2 are complete and take an acknowledgment? No need. 

It will just be an informational statement that I completed the ownership change but am still the owner and no terms of the lease change including where they remit rent. FYI they already remit rent to the LLC business account which is stated in the lease.  Keep it as is.

B. Kindly provide me the website or contact details of Anderson Business Advisors. I will contact them for getting Step 2 above done. I have another attorney I work with but will definitely would not mind working with Anderson Business Advisors.  You can goggle the name for the website as I cannot put any outside links on the forum.  The attorneys have lots of youtube videos on different stuff that are very interesting. 

Thanks

@Harshal Gaikwad thanks for the additional information and clarification. You have a family living trust then. If you want to keep your privacy then form a "land Trust" to hold the property in and make the beneficiary your LLC. You will be taxed $800 a year by California just for having that LLC. If you own more properties, then you are good for now. Don't worry about changing anything on the lease. Your LLC should be owned by your family living trust. I use Anderson business advisors for my setup.

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@Harshal Gaikwad STOP! You have things done correctly right now with only a few changes. Keep the title in the name of the trust (privacy reasons.) In your (Private) trust change the name of the beneficiary to the LLC, (hopefully not in California.) This will give you the asset protection that you are looking for.

1. Create a simple lease amendment notifying the tenant of the Landlord Ownership change and that nothing else in the lease changes. (No, keep it as it is.)

Get this amendment signed by all parties

2. Do nothing: The Trust ultimately owns the LLC and therefore even if the property is re-deeded to the LLC, trust has ownership right too. (See above.)

3. Send tenants a notice of ownership change that you no longer own the property but now the LLC does.  (NO!)

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@Dylan Speer sell it, come up with the negative money balance, write the loss of on your taxes and move on with your life.

You can sell it "subject to" to someone looking for a home with no money down and save on Agent commissions?

Are you able to turn it into an AirBnb or is that not allowed or too much trouble?

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@Brandon Jones keep charging them a late fee and stay on top of it.  I don't know where you live, but in California, I would immediately serve them with a 3-day notice to pay or quit.  If you are having these many issues, don't renew their lease.

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@Maggie Swift  What are you looking for?  I assume a fix and flip?  Here is a meetup in the OC

OC Real Estate Investor Networking - Tax Tricks Every Investor Should Know (biggerpockets.com)

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