Finance Question
I own a lot that I will build a 4 plex on. The property is owned under a corparation that I control. After the project is completed can I refi to pull cash out. Would I have to deed it to me personally? Would it be a title problem for the lender?
If you deed the property back to you or pull cash out, it will be considered a dividend when you receive the money, which is taxable.
i would talk with a CPA and attorney about which entity to use for your company. most likeliy the answer will be LLC, but each state has different laws and implications.
As far as software...for what you are doing, i would just create an excel spreadsheet for everything. If you use an off the shelf program it is only going to offer you average prices and NOT actual prices. Since your profitability is directly tied to actual costs, i would get hard costs from suppliers and subs in your area. Lots of building supply houses will do material take offs for you for free or close to it- that should get you in the ballpark. If you work off actual numbers then you will know for sure whether the deal works. I am sure you know this, but if you are licensed be sure and disclose that in your purchase contracts, even if operating via and LLC.
Good luck!
owner financing could be a great option. If you go the bank route, expect to have to come up with 20-25% of the cost as a downpayment. They ought to do a 12-24 month, interest only loan. When you do your construction financing, they will pay that loan off, roll the balance into the construction loan and then it will all be an interest only loan for constructiion and land. Good thing is at that point, they will usually loan you 100% of the cost of the land. It is cheapest to acquire the land just when you are getting ready to build, unless you can owner finance until then.
That sounds like a plan Woodsong,
Thank you very much on your reply. The 20% is feesible on $25,000 lots. I will put my package together and present it next week. Thanks a lot.
Trying to get a pulse on Land value down in your part of the world. The property in question is off hwy 22, in the county of Georgetown about 30 minutes from myrtle beach, could you give me your best educated guess on what the retail market holds on two acres?