All Forum Posts by: Todd Ashley

@Allan Smith

Thanks Allen. Yeah, obviously I am not trying to give the seller tax advice - just looking to frame the offer around some potential benefits that the seller would gain through owner financing.

Hi all, 
I am in the process of writing an offer for a farm property that we would utilize as our primary residence, but that also has potential to generate multiple streams of income. I have a friendly relationship with the seller who inherited the property from his parents in 2015. I would estimate that the value of the home in 2015 would have been around $350,000 and estimate that the current value is between $600,000 and $650,000 (the increase is due to improvements and appreciation). The seller moved to the property about ten years ago to help take care of his parents and has lived their full-time sense. It is my understanding that the seller should qualify to exclude up to $250,000 of any gain from his income. 

My question: If we were to utilize seller financing with a sales price of $600,00 and down payment of $60,000, would the seller miss out on the capital gains exclusion because he is not earning at least $250,000 in the year of the sale? Also, how does the mortgage interest that he would be earning impact the benefits/drawbacks of seller financing (for the seller). Basically, I am looking for ways that owner financing might benefit the seller in this situation. Thanks! 

@Marc Rice     Bingo! This is exactly the type of info I am looking for. Can you depreciate utility expenses? I am assuming you don't mean actual utility bills. Thanks! 

@Ned Carey

Thank you, that is very helpful. In this case I am thinking about future loans for properties or potential refinance(s) (not personal loans). 

Hi all, looking for a quick overview of which type of rental expenses counts against your debt to income ratio and which do not? For instance, I am assuming that any utilities I pay are a straight expense, but what about materials for a kitchen remodel? I assume those would be depreciated and would not count as an expense against income for loan qualification purposes?

@Nikolas W.

I purchased a house hack fourplex in March 2020 (Portland, Or). Pm me and I will answer any questions you have based on my experience.

Disclaimer: I do not have a Pro membership so I am not familiar will all of the current benefits of that upgrade.

Some of the most common questions I see in the forums are related to rent collection and property management software. Personally, I had been using cozy until I was forced over to Apartments.com, which I don’t love. BP seems to be uniquely situated to offer an all-in-one platform that could provide all of the current Pro benefits as well as rental management/rent collection tools, digital lease signing, listing auto-posting, etc.

Thoughts? Is anyone completely happy with software that is currently available? Seems like there is a pretty big hole where BP could step in.

It’s also worth considering the need to show reserves for each property once you own more than one. Banks require 3-12 months of reserves per property and most will allow you to use a certain percentage of retirement accounts (75% seems pretty standard) to count towards reserves. So sort of a two birds one scone scenario.

@Robert Laird I am unfortunately out of town for almost the entire month of August and will miss this. Particularly frustrating since it is so close to where I live! I would love to catch in the next meetup.   

@Chad Kastel

Nice, I invest in Otsego County. I am interested to see where you land with your inquiry - will follow this thread. Let me know if you find a good option offline.