All Forum Posts by: Steve Wilcox

The FHA announced they are deeply underwater, and may need tax payer bailout. It seems no decisions will be made until February, but I want to know how this affects all of us now? Does it change our investing strategies? What can we do to prepare, or position our businesses to continue to thrive in the face of even tougher lending guidelines?

http://online.wsj.com/article/SB10001424127887324595904578119140604024484.html

How would the tax ramifications or required IRS tax forms be different if they were to simply lend to the business instead of actually creating a mortgage?

Would this save any $ on origination and end of year taxs for either party?

similar thread http://www.biggerpockets.com/forums/49/topics/78493-how-to-structure-this-private-money-arrangement

I have filed multiple llc's in NJ. Very easy, save the money. The only concern I would have would be if you were planning to hold properties in the LLC to make sure it was set up correctly to prevent corporate veil piercing by tennants

What are the tax ramifications so that you can write off the mortgage interest, and so that you do not pay a gift tax on the money?
How is this affected by the SAFE ACT?
What needs to be done upfront in regard to the IRS for form 1098, ect, when setting up the money to purchase?

You have to be an owner occupant to qualify for an FHA loan. It is ideal for a rehab if you can meet the owner occupant requirement. If you do not have a lot of rehab experience then the appraisals and inspections and contingencies reserves required by the 203k can be a great education, and a great way to get into the game if you don't have cash.
The entire 203k process is a PIA, but it allows you to put almost nothing down (3.5%), and get a very low interest rate as compared to hard money. Also finding a contractor that will actually work with the terms of the 203k (not get paid anything up front, lay out their own cash to purchase all the materials, and getting a 1099 from the bank when its all done). The process is not fast but its cheaper then hard money, and if you dont have the money yourself than its a great option