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All Forum Posts by: Jennifer Gligoric

Jennifer Gligoric has started 43 posts and replied 133 times.

Originally posted by @Paul H.:

@Jennifer Gligoric, thank you very much.  I made a backup before I grant access and will use your advice as I do my D.D

Good Luck :)

My advice is to steer away from hiring foreign accounting teams entirely. I was hiring on Upwork back when it was Odesk & ELance and the platform now is even worse for screening foreign workers than it was way back when. In my career, I've hired several thousand staff, the last decade, fully remote workers using a variety of talent acquisition methods for a variety of clients, before I opened up Leafy Legal. In every single case when it came to most VA, support, back office, I ended up spending 3x what I would have paid for a US Citizen hire through the same platform in revisions, communication delays, issues, fixing errors and so on. The rates seem so attractive but not when it takes them weeks to do what a pro can do in a matter of hours with no communication gaps. Accounting in particular, especially with so many tax and deduction ramifications for misclassification of expenses, income and depreciation really demands someone in the states.

At first, I would not give them accountant access if you still decide to go this route and I would set user permissions to only give them access as a user and then customize it and oversee them until you get comfortable.  Upwork does not guarantee anything with contractors, other than to allow you to dispute a payment. In the TOS you assume all responsibility for vetting and hiring so (as with anyone with access to your banking & accounting information) use due diligence and make sure that they sign your own NDA, access agreement and make sure when you onboard them you get a copy of their unexpired identification and national insurance number.  In Pakistan, it's the CNIC & you can verify it online.

*I am not an attorney, I simply know the best ones.*

Originally posted by @Ryan Alexander:

@Jennifer Gligoric @Chris Mason

Thanks for responding. So I'm actually buying the purchase through my name (not LLC, bank wouldn't lend to LLC). Conventional loan, 30-year with 25% down. Mortgage is under my name. And partner and I will split all income and expenses starting with the down payment. Plan is to purchase under my name and him and I sign the agreement through an attorney.

Do you see a problem with this?

Being an asset protection specialist, yes. First you won't be able to transfer the property into the LLC (if that is what you are stating you wish to do) without the bank calling the note due because it runs afoul of the Due on Sale Clause. That will be something to consider as they from on material changes of ownership, of which this would be. Thankfully there are ways to hold the property you might wish to consider that were opened up with the Garn-St.Germaine (DI) Act.


Secondly, asset protection wise, if you keep it in your name you increase your liability and risk, even with a contract due to the vagarities of the system.  It might be prudent for you to figure in a monetary or other compensatory allowance for yourself since you wish to assume this risk if you choose to leave the asset vulnerable.   

*I am not an attorney, I simply know the best ones*

Might I ask how you are purchasing the property?

With the right post-sale contract you can set up a variety of structures but as @Chris Mason stated, how you purchase the property might prove to be problematic.

If the property is using cash or hard-money, then you will have more flexibility. Also, I'm not clear on why you'd need an operating agreement if you already have an LLC, instead of new contract between your LLC and his?

*I am not an attorney, I simply know the best ones*

Post: Newer Investor, should I do this?? (Asset Protection)

Jennifer GligoricPosted
  • Specialist
  • Posts 137
  • Votes 125

With that basic explanation and not knowing all the complexities (i.e. does the asset protection include a comprehensive estate plan, retirement, various trusts, etc you can use for personal assets & private tax/estate benefits as well, or just for the real estate business?) for just entity structures for one rental and only a plan for perhaps more the pricing does seem pretty steep. They're very good and I know Clint, he's a smart lawyer and investor and passionate about what they do there.

In this climate right now with what we are seeing on the litigation end, I'll just say what I always do which is to treat your business like a business and assume you will be successful in business so build the foundation that can handle that success. Cliche' I know, but I strongly believe that you'll never regret having the right structure combined with a REI friendly insurance plan.

*I am not an attorney, I just happen to know the best ones* 

While owning, without more, real or personal property is not considered a business -  fulfillment of lease contracts, including property management, is considered doing business. You can have a vacation home of course, but that won't entail contracts with the public where they are legally obligated to purchase possessory rights for termed limits and their failure to abide by the contract may result in the business of having them fined or evicted.

Many landlords in many states run into issues when their property managers, or they themselves, go to evict tenants but they can't prove that they are representing the owner of the property which has the legal right to provide accommodation rental services in that county/state.  The county won't file the eviction & you may run into owing taxes, fines & penalties for operating a business without having the authority to do so.  

So yes, it's important that you or your property management company be registered to either fully handle property management in that state, including a clause, allowing them to make decisions on your property.  Different states have different laws on this, and some states/counties even require a housing business license.  It's important to become familiar with the housing laws in your state you are investing, even if you are renting a portion of a second or even primary home as an AirBNB/VRBO.

* I am not an attorney, I simply know the best ones*  
 

@Seth Rouch You should ask your agent if your jurisdiction has any law regarding “good faith and fair dealing covenant”.   If so, then this could be broken by someone using many agents to make multiple offers at once. This is usually used to prevent one person from making many offers on different houses that they would be absolutely unable to fulfill all those contracts at once if they were all accepted.  Since this is the same property, this might not apply but it surely is unethical and believe those agents have a right to know if this is happening.   


* I am not an attorney, I just happen to know all the best ones *

@Kiera Underwood  *gets off her soapbox and high fives you from afar then makes a peace symbol with her fingers theatrically* Lulzzzzz

All the investors I've talked to fall into two camps, those who were not stable but trying to gain stability through real estate and those who were stable and wanting to grow.  The ones who are stable are seeing the opportunity in this, both from a foreclosure standpoint in being able to snap up properties and those who realize that everyone needs a home and there will be stimulus and with global warming, heat which scientifically is shown at 86 degrees to inactivate the virus on surfaces, making it much harder to pass.  Already today, Italy just had a 103 year old woman recover with treatment.  If we just chill now this will pass but the opportunities will abound.

Investors who are less economically stable are worried, but I don't think they should be.  Historically, in times of turmoil this has been when many people rose up to make their fortunes.  Thankfully, we have unbelievable technology and the ability for even entertainers to work remotely.  Not being glib, but having helped orgs scale for a decade using totally remote workforces, this is not that big of a deal.  It's a change to the status quo and personally I feel it couldn't come at a better time.  It's better for the planet to have as many people as possible work from home and it's better for orgs to go through this - as many orgs are stuck in dinosaur business models with outdated management styles that should be left in the dust.

I'd point to the overwhelming opportunities people will see.  Just today I spoke to several entrepreneurs, one a boutique hotel sales consultant.  I said "Call every client that booked a meeting and tell them their conference isn't canceled.  Research Online Summit providers, get a quote and then provide that conference virtually but you be the point person & jut sell it.  Marketers have virtual summits all the time that are huge hits, just get the right partners and call everyone with a new plan."  I told a girl annoyed that she had just booked a great gig, she's a folksy guitar player / singer,  to sign up for Patreon, do eVites and then have people pay to watch her perform on video and chat with her fans - guess what - her list responded positively on her Insta and now she can do something, whole venues need to think about this.  Every waiter / waitress can now see about being a delivery driver or helping - it's temporary but really, we can't shut down the economy.  We can use tech to help us.

Let your investors know that now is the time to be bold, be brave and be confident.  They are the ones along with these other people thinking outside the box that will help save the economy from totally tanking.

We're Americans after all.  Being innovative and spitting in the face of adversity, conquering it and managing to do even better is in our DNA and we need to reclaim our individual greatness instead of the negativity that gets poured on us daily from the media.  I'd double down on confidence and do what you can (as I am) to help them make the wisest choice they can so they have the best chance of success and if you can help them avoid a bad deal - then, of course, do it because we're all in this together.  

Post: Coronavirus and late or no rent payments

Jennifer GligoricPosted
  • Specialist
  • Posts 137
  • Votes 125

I've already reached out to my Congressmen and asked for them to come up with real-world solutions and use bail-out money to forgive mortgage and utility payments until the quarantine is lifted.  France has done this for the country.  Italy has done this.  

Knowing full well the litigiousness of our society in times as my entire daily job is helping investors mask assets from vexatious lawsuits, get the right estate plans in order that fit their business, and operate under the correct structure, I am fully convinced that eviction will not stand right now and believe that despite it being technically legal civil courts will start to fill up with angry tenants who will point to their employed status pre-quarantine and payment history and accuse landlords of malicious and predatory practices, as well as, even lie driven by desperation accusing them of other serious misconduct.    

If landlords do not have mortgage or utility payments due, this should ease for renters. Without that, we have millions of workers suddenly evicted & violence will ensue.  You can't put this many healthy working people out of work & not expect them to go full metal jacket.  They won't have it.  This is not people who just don't want to pay rent, these are people that absolutely can't because the government has taken away their income-earning ability.   This isn't the same as normal course of business and should not be treated as such.

I think that instead of digging in our heels to pretend this is no big deal or digging in our heels to panic - there is a median we should follow that should have us all push for a more innovative approach to this that helps us all.  We can do it and we can demand it.  Right now billions are in Grants to do things such as educate Guyana on clean water - the Grant program for overseas aid alone could be halted and all funds given and restarted after this.  There ARE solutions, we have to demand them now and not lose our heads or our humanity.