All Forum Posts by: Kelly Wright Kelly

doing the tax lien loan is a good idea, but there are some regulations that have to be complied with, I would use a local attorney with experience in that area to make sure all the t's are cross and i's dotted

I agree with Mr. Rohde, buying the entire LLC would put you on the hook for any pre-sale liabilities whether known or unknown. It might be able to purchase some long tail insurance that would help alleviate this somewhat though

David, 

The Texas statute does not reference the “public”.  Our statute defines it as “generating electricity for compensation”. We’re also a freedom of choice state where you have a statutory right to choose your provider.  So you could sink a lot of money into getting set up and licensed and have a tenant say “nah I’m buying from the regular utility”

At least in Texas, since you would be the one generating the electricty and then selling it to end users I think you would have to register as a utility which would be cost prohibitive.  

I'm curious what everyone thinks as I'm been trying to find an answer myself.  My understanding is that contributions in kind aren't going to be subject to the stepped up basis so extra equity for managing and/or syndicating may not be any different than an ordinary deal

I think it's a good area to be in for a long term hold.  Traditionally it's been a pretty rural town that had a boom with the Eagle Ford shale play and then dropped some when oil prices when down, just like most of South Texas. But I think long term it's got the potential to be a bedroom type commuity to San Antonio, there's starting to be more development on that side of San Antonio and I think employment is going to go up in Pleasonton.  One of the bigger oil field pipe suppliers has been servicing that area out of their Houston and Odessa locations but is talking about opening up a Pleasanton which should bring in a number of higher paying jobs.  

 .  I'm assuming it's in Bexar County. If so the probate court most likely already appointed the attorney ad litem for the kids.  If so, you need to pull the probate pleadings to see who that is and contact them to see if they will agree to the sale.  If they do, you probably don't need to go to the expense of hiring an attorney as the ad litem will do the work to get the court's blessing on the sale.  

If it's a Bexar County case you can search on the county clerk's website for the case number and then go in person to the clerk's office to get a copy of the petition, the order appointing the ad litem and the order appointing the administrator. 

You'd be surprised what insurance may or may not cover.  I practiced as an civil defense lawyer for a couple years and can think of the following situations where insurance didn't cover just off the top of my head: 

1) agent pocketed the premium and issued a fake certificate of insurance. This went on for a couple of years and the insured never found out until there was a claim.  The agent ended up in prison but that didn't help the insured who was now on the hook for a couple hundred thousand dollars in damages;

2) fire was caused by an electrical short and not covered once the carrier found out there was aluminum wiring.  This was an 8 or 12 unit complex and tenants all sued landlord for losing their possessions due to the fire.  

3) several cases where the landlord or seller was sued for property code violations under the deceptive trade practices act and the carrier denied coverage as the allegation was of an "intentional act".

4) Insurance won't cover breach of contract claims typically, say you get into a dispute with a contractor the insurance isn't going to cover it but are you going to see it through to trial when your personal assets are at risk in the event you're wrong. 

5)Not real estate related but I had another case where I represented one of two partners who were sued for a business deal gone bad. They never formally set up the partnership but one guy was acting through an LLC and my client was acting in the partnership as an individual. Long story short, the partner with the LLC just let a default be entered as his LLC had little to no assets and he had no personal liability. He let the plaintiff execute against what few assets the LLC had and then set up shop a few weeks later under a new LLC. My client had to scrape and claw at a payment plan settlement because his personal assets were at risk if he went to trial and lost.

I look at an LLC as an umbrella policy with a one time fee so long as I keep the paper work straight. I may never need it but its a lot cheaper in the long run just to pay the $400 bucks and not have to worry about it.

The other advantage is that the llc doesn't just shield you from the investment's liabilities but will also shield the investment from your and your other investment's liabilities. Divorces, partnership disputes/lawsuits, deficiency judgments and called loans all can happen more often than you think. The LLC will help you to break your portfolio up into little compartments that are insulated from one another, so if something goes bad with you can can write that part off and have the others largely unaffected. Say you lose a property to a foreclosure with a personal guarantee on the note and the lender takes a deficiency judgment, your other properties are now subject to foreclosure to satisfy the deficiency since they are held in your name. If there were in an LLC they aren't liable for your debts.

I think it's going to be tough to do unless one of the kids has a power of attorney or is a court appointed guardian as otherwise they wouldn't have legal standing to do anything with the house such as leasing it or a less option. I would also be wary of a lease option as Medicaid has a nasty habit of showing up with lien on the property later if they paid any portion of the nursing home care. Selling the house now may jeopardize the parents Medicaid eligibility as well.  I would either pass or consult with an elder law attorney in your state. 

depending on the land size it may be worth looking into setting up a wetlands mitigation bank. To get permits in sensitive areas develops will sometimes be required to offset the impact by contributing to a wetlands bank