Should I Own Properties In My Name Or A Business Name?
Good morning,
I have a client that is interested in purchasing five properties from me, she currently owns 15 other properties in her name and the loan officer is stating she owns too much real estate in her personal name/credit.
What can she do to correct this issue? and purchase my 5 properties along with the additional 6 she has shown interest in?-Urgent.
What benefits would she have by using your solution?
There are more than 80 million lawsuits filed in America every year. Property owners, landlords and real estate investors are susceptible to liability. Why would you expose your most valuable assets to public scrutiny?
I hold all my properties in a land trust for privacy, and, with non-related tenant co-beneficiaries, for asset protection.
Good luck.
_________________
"Dissent is the highest form of patriotism" - Thomas Jefferson<BR><BR>
[ Edited by mtnwizard on Date 11/03/2006 ]
If I understand the question correctly, how she’s holding title isn’t the problem. Because, even if she put title in a land trust, the loans would still be showing up in her name and on her credit report. Which I believe is the real problem.
There’s a couple of options that comes to mind.
Depending on the equity she has in her existing properties, she could do a cash-out REFI on a few of them and pay off other loans to close them out. Or, she could do a few REFIs and just pay cash for your properties.
She could also look to cross-collateralize and/or get a blanket loan on her existing properties.
Or, she could just go with a lender that doesn’t care how many loans she has. There are still a few out there.
These are just a couple of quick ideas that pop to mind.
Can you name of the blanket lenders out there? she really liked that application...
Quote:
On 2006-11-03 09:33, Thawkins wrote:
Good morning,
I have a client that is interested in purchasing five properties from me, she currently owns 15 other properties in her name and the loan officer is stating she owns too much real estate in her personal name/credit.
What can she do to correct this issue? and purchase my 5 properties along with the additional 6 she has shown interest in?-Urgent.
What benefits would she have by using your solution?
More than likely you will want to form two types of business entities: An Sub – Chapter S Corporation for properties that you intend to “turn” and a Family Limited Partnership (a Family Limited Partnership is basically the same as a limited partnership where your immediate family members are the limited partners. This will effectively avoid “quick turn” classification from the Internal Revenue Service.
Remember a corporation is a separate "person" under the law, and therefore, if it is properly organized and managed, it should protect its owners from any personal liability for corporate debts and obligations and from claims against the corporation. Also, the purpose for which the corporation is formed determines the “Quick Turn Investor” status. In other words, you can be both a “Quick Turn Investor” and a Regular Investor at the same time.
see
http://www.instantinc.us/pdf%20files/Incorporation%20Newsletter-1.pdf
for basic corporation information
[ Edited by ctsee11 on Date 11/03/2006 ][ Edited by ctsee11 on Date 11/03/2006 ]