All Forum Posts by: Micah Starbuck

Thanks all for the recommendations.  I'll start reaching out today.

For those asking, the park is near Franklin NC.

Hello all,

I'm in the process of purchasing a FSBO campground in NC.

I haven't operated in NC before so I'm looking to see if anyone has recommendations for a closing attorney and an SBA lender.

Thanks a ton.

@Brian Eastman

Thanks for the info. I'm planning on leaving my current employer at some time in the future to open up those funds.

With regard to the release of funds, I wouldn't be putting 100% of the 401k into the ROBS. A portion of it would be used to purchase and renovate, then another portion would be used to purchase from the ROBS and then another portion would be used to start the property management.

You say that this wouldn't work because the IRA is not allowed to buy or sell with me. But at no time would I own the property or benefit from the transactions as an individual. All money would be transferring between the IRA and SCorps which seems like should be allowed since it's all still trapped within the pre-tax shelter.

My only benefit would be the income I collect from the SCorps as an employee which is allowed (within reason) by the IRS.

I've been brainstorming on the best way to leverage my employer 401k to scratch out a living.

I know there are limits on what you can do with each type of approach when utilizing retirement money.  A ROBS is good to make an income but bad for holding property where Self Directed IRAs are good for holding property but you can't get paid.

So here's my question: Can I use a ROBS to purchase and renovate property (allowing me to get paid to run the project) then sell the property from the ROBS to a Self Directed IRA and then have the Self Directed IRA hire a second ROBS to manage the property (and allow me to get paid to manage the property)?

In other words: ROBS1 (fix and flip) sells to Self Directed IRA (to hold) who hires ROBS2 (to manage property).

I was thinking this might work as ownership of the property remains within the retirement accounts and I don't directly benefit from the renovation or sale of the property but allows me to get paid for managing the assets within the account.

Yes/No/Sketchy Maybe?

Well that's a bummer.  Thanks for the info though.

@Carl Fischer, I know that's true with a self directed ira but does the same hold true for a ROBS?

I'm trying to figure out if I can use a ROBS to develop a turn key rental and then sell it to myself at a fair market rate.

I've seen a fair amount of discussion where using a ROBS to hold rentals is discouraged but it looks like real estate development would be OK. I just can't find whether or not I could purchase the property after it had been rehabbed without breaking some rule or law.

Thanks for the reply, @Alex Kim.  Having multiple offer types is a good idea.  I spoke with another investor that's helped me in the past and he had mentioned doing a wrap around loan.  I'll look into that a bit deeper and see if that opens up any other options.

The idea for the 20 year payback was to meet their third requirement of having an investment that would last through their retirement.  It's not a whole lot but would likely be better than what they're going to find investing on their own.  I don't know what they're looking at in terms of motorhome cost but I figured the $25,000 up front would at least cover their down payment.

Looking to get additional eyes and thoughts on a potential purchase.

Here's the breakdown:

Home value: $250,000

Amount owed by owner: ~$150,000

My potential offer: $175,000 + $350 a month for 240 months (or $84,000, whichever comes first)

Rent: $1,500/month

Repair: <$5,000 (if any at all)

The owner is retired and full-time RVing.  They are currently renting the house for $1,100/month.  They are looking to sell the house, purchase a newer RV and invest whatever's left in a way that pays them monthly dividends.

I think this hits all their targets but I'm open to other ideas or approaches.

Thanks a ton.

@Johnny Pineyro, I don't need the equity unless we're looking to relocate our rentals.  We're actually actively looking where we are now.  It's just a matter of whether we want to keep these two while we continue to expand.  Self-management isn't really an option unfortunately.  As far as extensions go, we're actually OK now that winter is there.  The fines are in regard to landscaping which isn't an issue once it gets cold there.

@Russell Lavoie, for sure we'd be doing an exchange.  Just a matter of whether we pull the trigger or not.

@Jackson Pontsler, since you're in SLC, do you happen to know a landscaper that works in Ogden?  Maybe you can give me a track on someone who will work with an out of town customer.

@Londell Reedman, that's the rule I keep coming back to.  We could sell but we'd be essentially hitting the reset button and would take a few years to get back to where we are (but we more properties than we have now).

@Martin Carstens, thank you for that recommendation.  Our properties are actually in Ogden but we'll reach out and see if they service our area.  A more robust PM company would go a long way I think.

@Bryan Devitt, the tough part is they're really good at placing tenants and responding to small problems (maintenance items, tenant complaints, etc).  Where they're lacking for us is taking on larger projects.  But you are right; a new PM should be top of our list.