All Forum Posts by: Mike S.

@Drew Sygit

I never provided copy of the full trust for any refi. However I had to provide a current certification of trust that showed the main information about the beneficiary, trustee and his authority to refi.

@Jibu V.

So far for me, I need to have a $150 roof inspection every year that certified that the life expectancy is at least 5 more years.

@Jayden Hamilton

Personally, if I didn’t foresee needing that money in the next few years, I would put it in a maximum overfunded permanent life insurance. I would then use the cash value in the life insurance as a super savings account or loan collateral and invest passively in some syndications in multi family, manufactured home park or storage facilities to diversify.

@Ashneel Reddy

She would need to work as a real estate agent enough hours per year and her income should be primarily from it.

@Mary Jay

You don't need an SSN to open an LLC. But you will need one to obtain an EIN, and without an EIN your LLC will have a hard time banking or doing business.

An entity can obtain an EIN if the responsible party has an ITIN. Your friend can obtain an ITIN from the IRS.

Last, check the tax issue with a foreign person owning an LLC. Some countries tax authorities won't recognize a disregarded LLC and would only consider a C corporation. Consult with a tax adviser knowledgeable about both countries tax regulations.

@Alfonzo Roberts

Some lender will let you change the title of the property to a single member LLC but the mortgage will still be under your name. They will not let you assume the mortgage by an LLC.

If you want to get a new mortgage under an LLC name, you will probably need a commercial mortgage with a higher rate.

I would disagree with you.

In my point of view the amount of net worth is irrelevant. However, I would put the two following conditions to make it worth:

1/ You have more than $5,000~$10,000/year of available cash for investment;

2/ You expect to have this amount available every year for at least the next five years;

1 seems a minimum to have a reasonable permanent life insurance policy. Lower than that and you may not be able to meet the minimum death benefit required by some carrier while keeping the policy optimized for maximum cash accumulation and minimum fee.

2 is the minimum amount of time to have the most efficient funding without triggering a MEC; and to absorb most of the front loaded fee. Also, if your time frame is lower than 10 years, you would probably earn more investing directly without using a life insurance. If your time frame is longer (even if your funding phase is only 5 years), your return of investment will probably be better by using a life insurance policy in the mix.

Using a life insurance policy is a long term game. The sooner you start it, the better you will be in the end. So even if you don't have a high net worth yet but have a minimum investment budget, it is worth considering starting a policy now as you will be ahead of the game later on.

My main regret with maximum over-funded permanent life insurance policy is not to have started using them ten or twenty years earlier. I am even recommending all my friends with newborn to start a policy on their kids instead of funding a 529.

@Jonathan Stevens

Legal doom…

Opening an LLC is very easy. You can do it yourself or pick any registered agent that can do it for you.

However, YOU need to know what kind of LLC YOU need: single or multi member, member or manager managed and in which jurisdiction you need it. That will depend on what your specific situation is.

Also, you would need to create an operating agreement made specifically for your need. This document can make or break your asset protection.

That is where a real estate and tax attorney are a must to consult unless you know exactly what you need.

I have heard multiple stories of legal zoom documents, that while legally correct, were not in the best interest of the client as too generic.

I would suggest to educate yourself on all the nuances of LLC out there by watching the YouTube channel of Clint Coons that has hours of content on that subject alone.

You don't need to have a net worth over $500k to use this strategy. And you want to put all your cash flow into the policy first before investing. The commissions are front loaded, but over the life of the policy, the average fee are around 0.25 to 0.5% per year, very comparable or even lower than a 401k or an IRA investment.

If your goal was to only put your money into the whole life insurance, then yes it is not a good investment.

However, if your idea was to put your cash flow into the life insurance, then borrow against it to reinvest the money in other investments. then yes it is a good idea. You then get your money working at two places at the same time.

Overfunded permanent life insurances are not very good during the accumulation phase, but are excellent during the disbursement phase. If you use the cash value as collateral for a loan, you then increase your rate of return and get the best of both world.