All Forum Posts by: Tom Yung

@Vitaly K., @Filipe Matos 

As a out of town(country) investor myself. 

I will strongly suggest you visit the area that you plan to buy your rental property. take a 3 day vacation. Check out the area in the morning, afternoon &/or Friday or Saturday night after 11:00PM. 

@Jay Hinrichs has a ebook for out of town investors. It is an excellent source of info for first time buyer or out of country investors that are going to invest out of state. Email Jay & request a copy.

While vacationing during the three days, meet as many local investors, agents, PM , lawyers, contractors as possible. you need a strong local team to make your investment work from out of state. PM is probably one of the most important team member if you are looking for buy & Hold investments.

@Sophie Younger sorry to hear your dilemma, I personally do not know Detroit, between vacancy & trashing of property from tenants, sometimes it is a better fit to cut the loss & sell, if you are unable to locate a reliable PM.  PM is one of the biggest hurdles that I experienced myself & from other investors.

@Jason Carter

I will suggest you; to check the date the county file the tax sale (which year). If the year  was registered as owner occupied or farm use at that time. 

The redemption period will be 2 years.

@Richard D. will be able to help with TX tax sale questions

@Chand P.

I have seem so many small business in this kind of situation during the last 30 years.

It is very unrealistic to expect YOUR friend to dig himself out in this situation. He/she has obviously extend the credit to the limit that there are no cash flow in the business.

If you can afford to lose the $200K because that person is your friend. Lend him the $200k & get a second lien on his primary residence. In most cases, if he can not turn his business(cash flow) around in 24 months. You might as well kiss your $200K away now.

Unless he can find another friend that is willing to lend him another $400K to stay afloat & pay you the $200K

@Amanda Sutherlin I hear many good advise from other posters already. I live in Canada. So carrying a gun is not permitted here.

Below is a true story, when you have to fight off your attacker, fight like a tiger.

Fear is such a funny word. I used to be a very skinny guy. 120 lbs & 5'9".

This story went back 24 years ago, I owned a restaurant with a bar in downtown. I have self taught martial arts for many years. Parents will not allowed me to train when I was young. At that time, I was working both in the restaurant and as a RE broker. One Tuesday night, after I finished my RE work & went back to work in the restaurant, 8 gang members came in and try to extort from my restaurant, they turned tables upside down, scaring all customers away, throwing chairs. Just like a set for the movies.

I was mad & have more fear(concern) for the safety of my wife, my mom, my employees & my customers. After I knew the customers, employees are safely hiding or left the building. There were only 3 of us facing the 8 gang members. My wife, my brother & myself. One gang member took my glasses away & when My wife tried to take that away from him. He punched my wife. At that moment, My fear was gone & replaced with anger and power. Long story short.

Even I had not practice my martial arts for 15 years. It came back. all 8 left with some sort of injury on them. It took the police 16 minutes to arrive after they all left. Then I was told they went to China Town & extort 2 other restaurants.

It was the first time I knew the meaning of HATE, after that incidence I have faced gun(just once), knives, brass knuckles, screw drivers, you name it.

I have turn my fear into a power whenever I face a situation like that; from that day on. Now I teach martial arts on the weekend in our community center(non-profit).

One more thing, you only have 3 seconds to finish an attacker if you are smaller. It has to be FAST & ACCURATE.

@Craig Garrow

You are talking tax lien certificate, the three gentleman above are talking tax deeds.

1)Actually redeemable tax deeds.states like TX, GA, TN, it means even if you are the highest & winning bidder, the owner can still redeem the property from you during the redemption period. You will receive the original bidding amount together with the interest or penalty

2)About half of the states are tax lien states Like NJ, AZ, SC. In most cases, you will get interest payment , but rarely get the properties. Watch our for the life of the lien, there is a expiration period.

3)Some states are Hybrid; that means they have both tax lien & tax deed.like NY, OH, FL. For example, FL , first sells the tax lien & if there is no redemption,lien holder apply for the property to tax deed sale. No bidder. The lien holder are now the owner. If there is a higher bidder, the lien holder gets his share of interest payment.

4)About half of the states are tax deed, that means if you go to the auction & won, you got the properties. States like CA,M,OR

Most states now have online bidding by third party or live.

pick a county & see if the county offer on line bidding & if so, which site.

Most of these sites offer free on line training, so you can practice.

MAKE SURE YOU READ THE DETAILS ON EACH & EVERY COUNTY, CITY & STATE LAW & RULES REGARDING THEIR TAX SALES. THEY ARE ALL VARIED SOMEWHAT.

@Dr. sharon Gold

Both advice from @Joel Owens & @Michael Seeker are excellent.

Commercial building value comes from the land & the best & highest use. 

1)If you can use the buildings & make the best use for yourself, then it is worth a premium to you.

2) if you can tear down the building as Joel is saying & put up a national NNN tenant there, there, then it is worth a premium.

3) in most other cases, it is based upon the income approach, how much rent as Michael is saying; will this place generate & multiply that by the market cap, you shall have a fair market value.

4) if this location is at the dead end & needs work, stay away or offer whatever you think is worth, never mind about the asking price. In most cases like this, the seller is more anxious to sell than you to buy.

@Amanda Sutherlin @Karen Margrave  & @Jonna Weber 

First congrats, Amanda for your first & beautiful property. Great Job.

It is so true that all you ladies get the point. So many parents will not let their kids involved into the real life working environment nowadays. The kids are so protected that most of the time they are just locked into their own little world of homework, playing video games, face book or what ever. They do not even do chores in the house.

The kids that grown up alongside with their parents, seeing the real world, how hard their parents have to work to be successful actually are more mature than the ones that are protected inside the green house. They turn street smart at a very young age.

Thumbs up to all you SUPER MOMS

@Lisa Foster-Bryant

I will suggest to stay away from th/condo too, I have two myself (65-85K value); before I started to invest in Tax deed properties in GA. 

The % of TH/condo properties that defaults in taxes are so high, it actually scares me.  Most of them fall into the price category that you described. 

I will not consider them as a investment opportunity.

@Account Closed 

see all this valuable info that you can generate from @Roy N. &@Chad U..

What Roy described has been used & taught many years in Canada for US RE investment.

What Chad said about LLP or LLLP has been adapted by a lot of CDN investors in the last 4-5 years. But as all suggested, seek professional consultation on tax & legal matters.

All of us here wish you the most success. I am not qualified to give tax suggestion. 

BETTER KEEP MY MOUTH SHUT.

BTW, I honestly do not think you will get this kind of info from guru classes.

@Account Closed 

I saw you are from Edmonton. So I presume you are CDN. 

For a Cdn to purchase RE in US, they have to form an entity for a EIN, so they can report tax to IRS. You can buy it in your own name too, you have to apply for ITIN , if not;there is a withholding of rental income by your property manager for year end to report tax. Without a EIN or ITIN. you may have a problem of opening a US banking account.

I will strongly suggest you to find out more on you own on the above before you purchase or go to any guru class.

Also LLC is not consider as a flow through entity from CRA standpoint. so rental income will be double taxed in both US & Canada. Find out more from an cross border accountant on your own particular tax situation. Set up your entity right from the very beginning, All this CDN or American Gurus will not tell you this either.

Another thing that I really hate to say is the amount of capital that you have is not really helping you. Do not fall into the trap of buying cheap properties with a hope of getting steady rental income. Most of this 10-15K properties are in War zones.

There is a big difference between CDN & American war zones.

@Jay Hinrichs  has just publish a ebook for out of state investors, send him an email for a copy. You will see much better pictures.(make sure)

If you do acquire enough knowledge for the US market. TX is very strong as @Account Closed indicated &  @Hattie Dizmond suggested pick a market.Spend some time digest the old forums on different city, county & state, you will be surprised  how fast you can learn on yourself, Be patient, RE knowledge take time . 

All the best to you & your family.