Tired Of Being A Landlord
I am considering to slowly divert the rental income to other saurces of income by selling out and investing to what???? approx. starting amount $500.000. What would be a no risk factor and how much return of the amount could I expect. Any thoughts I would appreciate.
Thank you
Konte
Your return is directly proportional to your risk. Low risk, low return. High risk, high return.
For no risk, US Treasuries are safe enough and will allow you to stay ahead of inflation. You can get yields starting at 4.25% depending upon the term of the bond or note.
Hi Town3, thanks for your reply.Your estimate sounds more realistic than that of the Financial Advisor. He said 10 to 15 % but I did not believe him. I guess I better keep landlording.
Thanks again
Konte
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On 2006-03-25 17:08, NewKidInTown3 wrote:
Your return is directly proportional to your risk. Low risk, low return. High risk, high return.
For no risk, US Treasuries are safe enough and will allow you to stay ahead of inflation. You can get yields starting at 4.25% depending upon the term of the bond or note.
Konte, Im in the same boat. I should be have over 800K in equity and Im a little tired of being a landlord.
Im still want to stay in the RE game but more as a rehabber and short time landlord until property is sold.
Im too afraid of the tax hit if I unload all properties at once.
Hi 99 I had the same thoughts, buy, rehab and sell but prices are to high right now . By the time you rehab and put back in the market ,allow min. one year,the market may go down and therefore we maybe taking a chance.Keep in mind that the majority of sales do not go over a quarter miI. and they are in need of a lot of rehab. Selling we have to face the tax issue, I bought years ago at exteremely low prices and my gain is high, in selling I will have to make sure I can recap these loss withing a reasonable amount of time. I am watching the market, the demand slows down so are the prices so will see. Good Land is another way but you see no income for a long time. We are both in Connecticut ,were in Harford do you have your rentals, I am by UCONN.
Konte
Quote:
On 2006-03-26 22:30, vguess99 wrote:
Konte, Im in the same boat. I should be have over 800K in equity and Im a little tired of being a landlord.
Im still want to stay in the RE game but more as a rehabber and short time landlord until property is sold.
Im too afraid of the tax hit if I unload all properties at once.
Become a hard money lender. You can get 2-6 pts at closing and get 12-16 percent per month. You can demand a survey and appraisal - which the morgagor pays for - and only loan on 70% LTV. So if you have to foreclosure, you are getting a house 70% LTV. Join a local investment club and start looking for experienced rehabbers that need money. Or run an ad in the newsletter.
I like the idea and I have thought of it in the past, not only for housing but for other items as well however they call it "Hard Money? Lending and one will assume one has to be hard to be in that business and hard I am not. I had firends in the past that madae lots of money lending this whay but they also had their problems collecting. Getting Judgement does no put the money in the bank does it? They will have me for lunch. If I knew where to start and learn how the best protect myself I would really consider going in to it.
Thanks for you input,I would appreciate further thought.
Konte
Quote:
On 2006-03-27 08:06, bgrossnickle wrote:
Become a hard money lender. You can get 2-6 pts at closing and get 12-16 percent per month. You can demand a survey and appraisal - which the morgagor pays for - and only loan on 70% LTV. So if you have to foreclosure, you are getting a house 70% LTV. Join a local investment club and start looking for experienced rehabbers that need money. Or run an ad in the newsletter.
I do not understand. You are the first lien holder and have a mortgage on the property. You just do whatever your mortgage and note say. If they do not pay for 3 months (if that is what your mortgage says) then you foreclose. It is all very cut and dry.
Brenda.
Brenda thanks for your reply. I just have to learn about the foreclosure procedure, time involed,attorney fees and any loop holes that maybe hidden. I know here in New England the courts are not in favor of throwing families with children out of a www.home.I do have a good Attorney as well as an accountant so I will ask their thoughts on the subjet. Another thing I like about selling like that is the tax issue, you only owe to IRS money collected on the closing rather than on the full amount of sale.
Thanks again
Konte
Quote:
On 2006-03-27 14:25, bgrossnickle wrote:
I do not understand. You are the first lien holder and have a mortgage on the property. You just do whatever your mortgage and note say. If they do not pay for 3 months (if that is what your mortgage says) then you foreclose. It is all very cut and dry.
Brenda.
Doing a 1031 exchange into a Walgreens is a good Investment, as long as your not expecting a lot of cash flow in the begining.
What to put your money into all depends on what kind of return you want, Walgreens are considered to be a very safe investment, which in turns means, small return.
being a hard money lender is a little more risky, but has other types of advantages, ie. You are getting a monthly return on your investment, as well as a guarantee, if the investment fails, you get the real estate back.
Ultimately, you need to decide on what you want, cash flow or something safe to park your money. You can buy NNN shopping centers (with good national credit tenants), were yes you are a landlord again, your not dealing with yearly leases and the hassle of residential properties. Instead you are dealing with 5 year (leases) time frames or more, you can hire a property manager and you have a better cash flow than a NNN Walgreens.
Quote:Konte, Im in the same boat. I should be have over 800K in equity and Im a little tired of being a landlord.
Im too afraid of the tax hit if I unload all properties at once.vguess99,
Would you please explain your comment. How is the tax hit different (worse?) if you unload all your rental properties at once?
Hi King I like the idea of the rehab only loans as well as the 2 year min. with the 3 month penalty. The chances of them selling before the 2 year is high and therefore I will consider those 3 months as a bonus. Is the interest due monthly or at the end of the Loan period?What happens if the loan is due and they have not sold yet? What happens if there is a first lien holder and I am the second? the first forecloses for their share what happens to mine if they sell just to get their share out. What would you do?
Konte
16% per annual. No per month.
Brenda
anyone have recommendations on hard money lending resources/books/courses? I have $1mil cash to put to work.
1031 is a great way to go. Check out commercial options.
If you did want to pull your cash out and have it sit liquid, with very very low risk, you might want to try storing it in a margin account.
We always have a portion of our stock portfolio in SPY (american S&P 500) and IEV (European 300) at all times.
The risk is spread out over 800 American and European companies. IEV (the european index fund seems to be hotter than the US.)
Quote:
On 2006-04-07 13:28, kburke wrote:
It is 12-20% annually. In florida the usury law says you can get a maximum of 18% annually. So if you loan money for 6 month as 12% and 3 points up front. The yield on that loan is 18% annually. If your loan goes over 18% you risk not making any interest on the loan if the property goes to foreclosure.
Do you know if prepayment penalties and late fees are considered part of the interest rate in Florida? In many states, they are not.