All Forum Posts by: Russell Fugitt

I don’t know my November schedule yet, but will plan on showing up if available. 

Anyone want to explain if I am going to have to pay self-employment tax on my earnings if my STR earnings are not passive?  I have a tax guy telling me that I have to pay myself some amount and pay the employment tax on this payroll if it is active income.

Can’t make it that night.  Let me know when the next one is though.  

It didn’t turn in to a regular thing as far as I know.  I’m still in Goodyear, if any of you all want to meet up and talk Real Estate. I’m looking into buying some turnkeys out of state right now, but always interested in opportunities close to home. 

@Scott W. 

@David M.  Thanks everyone for your replies.  I think my goals are the question here.  They seem to be shifting by the day (probably not a very good practice).

I like the cashflow I currently get, but don't necessarily need it.  I would like the lump sum in the bank, but don't need it there either unless I find another investment to fund or get furloughed from my normal job.  I think I will take my chances on the furlough, plan to use other funds for any investment and accelerate these current loans with the cashflow I get.  I can always stop that at any time if I need to.

Check back tomorrow and I might have changed my mind again.

I listened to podcast #393 and liked the idea of 15 properties and refinancing one every year to live off the equity.  

I have 3 properties that have significant equity in them.  Going to snowball them and pay them off one at a time.  First one pays off in 21 months increasing cashflow 346/month.  Second one pays off 38 months later increasing cashflow 719/month.  Last one 33 months later to finish the job in 7 years 7 months.  Sounds great, but leaves me to cover vacancies out of my pocket or slow the payoff anytime vacancies or maintenance comes up.

The other option is to refinance all of these 30 year loans that pay off in 22 to 25 years into a 15 year and cash out 250K.  I would pay 5000 per month extra to the loan till my cash was gone.  This finishes the loan in 8 years (5 months later, but with a big chunk of cash in my account for the first couple of years).  

Anyone have an opinion or reason one way is better than the other?  Interest rate on the 15 year would be lower, than the weighted average of the current three loans, but really not much difference in interest paid since the term is so short.

Thanks for the advice.

Antonio,  

I'm not an expert here, but I do own a note.  I have a servicer.  Almost everyone says you need a servicer to keep everything legal.  They charge from $20 to $65 per month.  

Good to know.  Are the rates you mention realistic for the 30K range, or more for bigger loans?  Is there a good place to find these deals, or just networking with other investors?

Thanks for the quick replies everyone.  I think I can find a better place for my money.  I was aware of the risk of the lot fees, and thought the interest rate was a bit low.  I didn't consider that the Mobile home might depreciate significantly over the next few years.  

I have the opportunity (and cash) to lend 33K on a mobile home that is worth 37K.  I would have a promissory note recorded to guarantee the payments from the homeowner who will live in the home.

The deal would be for 96 months at 6% interest.  

My concerns are the risk of default and how hard it is to take back the mobile home.  The home is in a park that charges 400/month lot rent.  I don't want to be paying lot rent while trying to get the home back from someone who stopped paying.  

I am also wondering if the Dodd-Frank act applies here.  This is Arizona if that makes a difference

I am trying to search the site, but haven't found a real clear answer yet.  If there is a real clear answer in another thread, please kindly point me in right direction.

Thanks,

Russell