All Forum Posts by: Scott Minton

Thank you both for your replies so far.  Matt, I think you're right, that the bank may not call the note. But they did tell me that transferring title is not allowed by the rules, so do not want to break that policy, unless I can show them why they are not translating the rules correctly.  David, to your point: Yes, I considered changing the Operating Agreement to 51/49, but the danger there creates too many what-if scenarios that make it undesirable.  The purpose, in my (new to this) mind, is not only for legal separation, but for taxable benefits and in large part what seems like the right thing to do.  I partially understand compromising the corporate veil, which we are trying to not mix.  Keep business assets and expenses in the business and do not intermix them with personal assets or expenses.  But, using conventional loans up to our 10 each for investment purposes, seems too important to pass up.  I'm sure there are much simpler ways to make this happen and keep it all legal, reasonable and understandable. I was just hoping that the answer was a little simpler and with some help, I could show the bank why a partnership was acceptable for title transfer.

I've been scouring the forums for hours trying to find a post that gives me an answer different from what I'm finding. But I haven't seen this exact topic discussed, so here goes. My brother and I formed a 50/50 Partnership LLC. We plan on buying a few homes, renovating and renting them. We found our first house and we used my brother's credit to buy it. The loan is a Conventional Fannie Mae loan, which we specifically asked for because the title can be transferred into an LLC without triggering a due on sale clause. However, I didn't read this sentence (or at least had a different understanding of what it meant, if I did) "the LLC is controlled by the original borrower or the original borrower owns a majority interest in the LLC". The bank is stating that since my brother is only a 50/50 partner, he does not own a majority interest in the LLC. That's true.

Has anyone had luck arguing that technically both partners have a controlling interest or found any other mechanism to be able to transfer title into the LLC? Is the bank correct in its statement and we need to figure out how to refinance into the LLC?

Thanks, in advance, for your suggestions.

Scott

thank you for the feedback everyone. I'll ask the attorney who is going to work on my quiet title for his input. Knowing I'm underwater on this already and unfamiliar with how long these things take to write up, does anyone know how many hours would typically be billed for a lease option or seller financing contract?

Rhett: The property is at S Walker and 34th St. A few miles south of the river, south of downtown. Interested? ;-)

I'm very new to real estate investing and with my very first property (purchased at Oklahoma County tax lien resale), I made a big mistake and ended up with a vacant property that needs work, just to become marketable.  That's a long and slightly embarrassing story, so I'll get to the point.  The land assesses for $12,000.  I paid $10,200 and am likely going to need to hire an attorney to file quiet title, which will be $2500-$3500.  The land is in a C neighborhood area, but for the most part, not a bad area.  Houses in the neighborhood average $55,000-$65,000.  Trying not to let my mistake get the better of me, I'm trying to sell the land and simply recoup most of what I have into it.  I've had a couple people express interest in the land, but so far, none have wanted to pay $15,000, which is what I'm currently asking.  I've only had a sign in the yard for a couple weeks, so hopefully will still have others ask about it.  However, I had a caller this evening who asked if I would seller finance the property.  Again, there's no home on the lot.  He said he would eventually like to build something there.  Since I have no experience in seller financing, I told him I would need to think about it.  He said he would be willing to pay 10% down.  We didn't talk about any other terms.  I didn't get any suspicious gut-feeling from the conversation, which is why I'm now considering it and trying to do some research first.  It's not a lot of money, but I'd rather not have it tied up in this property.  However, as there are no new houses in this neighborhood (everything else is about 25-45 years old) and there are several other vacant lots (although most are in much better shape than mine) if I have an interested party, why shouldn't I consider it?  Other than having the cash tied up for a few years, what are the pitfalls and dangers?  What are the benefits?  What should my terms be?  Is there an easy DIY contract for this or will I need to hire an attorney or possibly just use a closing company to create the contract?  Thank you for reading through and giving your feedback.  One of these days, when I'm on the BP Podcast, I'll have a great story to tell about when I got started!  /sigh

Jimmy or Brent, did either if you have any success at the auction?