All Forum Posts by: Kevin S.

@Kevin S. If you have the first property just make it simple to get umbrella insurance would cover enough. Until you have a hand full of properties the you can have LLC or trust.

@Kevin S.

Personally, I would put everything in the right kind of revocable trust, but there are complications.

As a broker, I deal with a whole lot of lenders who claim they will close in a trust but don't really understand them.  The idea that Trustee has ownership in the properties is what gets most of them.  The trust will own the property, not the Trustees.  I can't count how many times lenders try to assign a percentage of ownership to a Trustee when numerous attorneys have explained to them that it doesn't work that way, etc... Many lenders struggle with umbrella policies as well.  They like to see a single policy with a single property so the costs associated with it are crystal clear.  I'd say about 60% of my capital resources will work with umbrella's but not without obstacles.

I use a holding company, an LLC, to purchase properties, then once completed with renovations, I either sell or hold them as rentals. Once I refinance to a perm loan, I will then QCD the property to the Trust. That way I avoid all the lender hurdles while they try to understand what they are and how they work. So long as you are a Trustee/Beneficiary of that Trust, you are still on title, so if they try to give you crap about it, it is very easy to prove that.

A better way would be to get a non-recourse loan, then QCD to the trust, but the pricing for non-recourse has yet to recover from what I've seen in the lending market so far.

I don't have any experience or insight into a JRT... or what the advantage would be over an entity when doing JV...

Cheers!

@Martin Yip Toll So You are making a mistake treating your debt relationships as strictly transactions. You are going to turn off a lot of lenders with your post because you are clearly going to shop every term sheet that's turned over to you with a focus exclusively terms with no regard for the servicing, loan administration and most importantly what that loan officer can offer you in the future. This is one of the biggest mistakes I observe.

While terms are important, take the time to get to know what each banker has to offer, their capacity and how they can help you grow. Bankers move around, rates increase and decrease, market conditions change, but these personal relationships can remain a constant throughout your career and will be critical to your success. 

I continue to work with a number of loan officers who issued me my initial loans 12 years ago. The two primary banks I worked with no longer exist  and all of my original banking relationships have moved onto different banks/lending institutions. In fact, I just originated a loan with a loan officer at the 4th bank in which we've originated loans together & now originate $8M loans with bankers who originated $80K loans for me when I started. These relationships, if cultivated properly, will allow your borrowing to outpace your balance sheet. The earlier you recognize this, the better off you will be in the long run

 I also would recommend Fidelity. They are easy to get started with an the support has been OK compared to others 

@kevin 

@Kevin S. If you are financing, you may be limited to closing in your name. If you are paying cash or seller finance etc, you'll have options. 

I close in a land trust or transfer to a trust after if I'm financing. A land trust provides anonymity (you can hold and transfer properties outside of public records) Then I have my LLC be the beneficiary of the land trust. So liens and lawsuits become more difficult to pursue. I have two great contacts here in Orlando if you need.

 Do one, then worry about how to set it up. It may take you months to get one. Worry about getting a deal closed, everything else is easy, 

You can transfer to an LLC after,

All the best