All Forum Posts by: Account Closed

Very good info here on TIC.. I have a couple additional questions in regard to this topic.

Background: LLC1 and LLC2 hold a property as TIC with the intent to Flip it. This allows the two LLC's to pool money without forming a separate entity.

Question 1: Does the intent to "flip" run the risk of being seen in the eyes of 2002-22 as conducting a business?

"Where the parties to a venture join together capital or services with the intent of conducting a business or enterprise and of sharing the profits and losses from the venture, a partnership (or other business entity) is created. Bussing, 88 T.C. at 460."

Question 2: Are LLC1 and LLC2 unable to advertise the property for sale within their own separate marketing structures (ex. LLC1 and LLC2 both market the property separately), or is this only pertaining to some entity that may appear to be formed under the TIC?

"The co-ownership may not [...] conduct business under a common name, execute an agreement identifying any or all of the co-owners as partners, shareholders, or members of a business entity, or otherwise hold itself out as a partnership or other form of business entity (nor may the co-owners hold themselves out as partners, shareholders, or members of a business entity).

Hoping to use TIC as a legal way to pool funds without getting into the web of SEC regulations and attempt to keep tax reporting clean.

Thanks in advance for any guidance!

@Mike Hartzog @Daria B.

Thanks for your replies. My apologies for the seemingly poor use of the term "broker". 

The loan will be originated by the company (they find the buyer, generate the note). I come in at first position, and then the individual that owns the company personally takes 2nd position.

The note will be serviced by a third party.

It is my understanding that financial institutions prefer to borrow to those with a W-2 showing solid income. I am about to retire from the military and will be receiving a 1099-R for my pension (I will also be self employed). 

My question is: In the absence of a W-2, do lenders consider (or even look at) 1099-R proceeds from a pension as favorable for lending?

To add context, I intend to borrow using portfolio loans under LLC's for rental properties. I understand that these loans will usually require me to sign for them personally. Yes.. I have read every comment on the internet regarding using a conventional loan then transferring to an LLC, but I am still not convinced that hiding from the possible due on sale clause is a smart move.

Thanks!

Looking in to rolling over my ROTH IRA into a SDIRA to invest in my first mortgage note. I am very interested in a particular broker, but wanted to ask a question here to do further due diligence as I am new to note investing.

Question: The broker that I am interested in normally takes second position behind the investors first position (me) holding. Should I be concerned about this?

An example given is on a $100k SFR with a 15% down payment, I come in at first position at 75% and the broker takes second position at 10%

At first glance, this seems like a positive since the broker will have skin in the game, but just wanted to ask you all what you thought. 

Hi there, I am selling vacant land via installment sales (zero percent interest, fixed term). I have been doing some research on whether I should consider myself a lender and therefore have purchasers sign a closing disclosure and a loan estimate form in accordance with TILA-RESPA regulations. 

Thanks for any input/advice!