Deal Structure To Minimize Cost In A Fast Flip
I am in excrow on a home that I had intended to fix, hold for a year to get long term cap gains treatment, and then sell. but a buyer has approached offerring significantly more than I am purchasing the property for if I would be willing to sell it to them right away.
Are there better ways to structure the deal other than completing the escrow I am now in to purchase the property and then immediately opening another escrow to sell the property that could avoid transaction cost and taxes?
If he has cash then offer to sell your position, cancel or assign your letter of intent to purchase that you have to him. If you arent too far with the financing he may be able to walk into that as well. If he doesnt have all of the money you are going to make on the deal at once then take some for the assignment and a second on the house to be paid at closing, or a promissary note on equity in another property ihe might have until it closes and he can pay you.
Good Luck,
Kyle
Great idea, thanks. I assume that this would save on the escrow cost. Any ideas on how to avoid it being treated as short term cap gains, or am I pretty much stuck with that?