How low can we go? 30 yr fixed at 3.75% with no fees...

[qwerty]

im a bit confused... how come these lower tax states like nevada always advertise like no corporate tax, no personal tax?...

if you open up a business in Nevada, like a new casino, the casino would not pay state taxes.  If you are a resident of nevada and work for a company there, you will not pay state income taxes.  Using your llc examples you can set up an LLC and have all of your operations in CA, you would pay taxes in CA, but not Nevada - so there advertisements are correct.

 

[Crispy3]

Good grief,

My present loan is with Provident but as you probably know, they're a really pain in the you know what to get to closing.  You must like
pain?    But $3800 is nice.

I'm not sure if it's the same with all the deals but I was told that once you lock, unless it goes down quite a bit, you're stuck.  Well, locking works both ways.  Maybe if it goes down to the high 2s we'll all be refi'ing again.

To be honest, my experience with Provident was pretty easy.  BHL was a bit more work to deal with since they pass your file along to multiple "processors" during the refi process.  Each have a specific job to do, but some will miss something and then it will get caught later when it is crunch time.  I hate being asked for information I already provided and it happened a few times with BHL.  With Provident, you deal with just 2 people and it was much more smooth. 

My financials are very clean so there wasn't anything out of the ordinary requested.  Maybe I got lucky....

No way could I ever go with Provident....I have way too many things going on with my finances.  Hell, my tax return is over 60 pages.

haha i am curious to how much u write off... lol...

I have several rental properties, various streams of income, short/long term gains on options trading, a 2nd home (where my dad lives), my primary residence, and all my business related expenses.  I think the trading activity takes up 10-15 pages.  The underwriters that had my loan files were probably not happy campers, I was the complete opposite of a vanilla borrower.  There was a lot of email explanations, additional documents that I needed to provide, and several letters of explanation detailing various things.  I write off whatever I'm legally entitled to write off per IRs regulations. 

Anything that you DON'T do USC?

i tend to prefer the the holdings company path style... for ur rental properties, do u hold it under a REIT? if u dont feel comfy talking about taxes u dont have to respond... i ask cause im not a CPA so everything i do ive learned from rich ppl guiding me, so im always interested in learning new tactics/strategies... i actually learned a few tricks cause of romney (since theres all these pundits out there that wrote articles on how they would have done it via trust funds etc if they were romney)... haha perfectly legal of course... to me, only idiots dont take advantage of it... lol hey no argument there, no one says the tax rate is the maximum u can pay uncle sam, since everybody is always free to willingly pay more on their tax returns if they feel benevolent , right? hahahaha

I've considered using LLCs and/or S-corps but at the end of the day the cost didn't justify the benefits for me so I just report them on my Schedule E.  Because I'm considered a full-time real estate professional I'm not bound by the IRS active real estate tax losses income limitations.  I have general umbrella liability insurance that I got to cover me for the rentals.  I read a lot on the IRS website and if there are ways for me to reduce my tax liability then I do those things.

single member llc in CA gets passed to individual anyway??? I have a llc for just a couple of rentals... are you telling me that I'm not gaining anything by forming an llc for it?

The only thing that you gain is liability protection.  Single member LLCs do not file 1065s, they are flow through entities that get reported on either Schedule C (if you have a non real estate rental generating business) or Schedule E (for real estate generating businesses).  Your CPA didn't tell you that???

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

 

[usctrojancpa]

Good grief,

My present loan is with Provident but as you probably know, they're a really pain in the you know what to get to closing.  You must like
pain?    But $3800 is nice.

I'm not sure if it's the same with all the deals but I was told that once you lock, unless it goes down quite a bit, you're stuck.  Well, locking works both ways.  Maybe if it goes down to the high 2s we'll all be refi'ing again.

To be honest, my experience with Provident was pretty easy.  BHL was a bit more work to deal with since they pass your file along to multiple "processors" during the refi process.  Each have a specific job to do, but some will miss something and then it will get caught later when it is crunch time.  I hate being asked for information I already provided and it happened a few times with BHL.  With Provident, you deal with just 2 people and it was much more smooth. 

My financials are very clean so there wasn't anything out of the ordinary requested.  Maybe I got lucky....

No way could I ever go with Provident....I have way too many things going on with my finances.  Hell, my tax return is over 60 pages.

haha i am curious to how much u write off... lol...

I have several rental properties, various streams of income, short/long term gains on options trading, a 2nd home (where my dad lives), my primary residence, and all my business related expenses.  I think the trading activity takes up 10-15 pages.  The underwriters that had my loan files were probably not happy campers, I was the complete opposite of a vanilla borrower.  There was a lot of email explanations, additional documents that I needed to provide, and several letters of explanation detailing various things.  I write off whatever I'm legally entitled to write off per IRs regulations. 

Anything that you DON'T do USC?

i tend to prefer the the holdings company path style... for ur rental properties, do u hold it under a REIT? if u dont feel comfy talking about taxes u dont have to respond... i ask cause im not a CPA so everything i do ive learned from rich ppl guiding me, so im always interested in learning new tactics/strategies... i actually learned a few tricks cause of romney (since theres all these pundits out there that wrote articles on how they would have done it via trust funds etc if they were romney)... haha perfectly legal of course... to me, only idiots dont take advantage of it... lol hey no argument there, no one says the tax rate is the maximum u can pay uncle sam, since everybody is always free to willingly pay more on their tax returns if they feel benevolent , right? hahahaha

I've considered using LLCs and/or S-corps but at the end of the day the cost didn't justify the benefits for me so I just report them on my Schedule E.  Because I'm considered a full-time real estate professional I'm not bound by the IRS active real estate tax losses income limitations.  I have general umbrella liability insurance that I got to cover me for the rentals.  I read a lot on the IRS website and if there are ways for me to reduce my tax liability then I do those things.

single member llc in CA gets passed to individual anyway??? I have a llc for just a couple of rentals... are you telling me that I'm not gaining anything by forming an llc for it?

The only thing that you gain is liability protection.  Single member LLCs do not file 1065s, they are flow through entities that get reported on either Schedule C (if you have a non real estate rental generating business) or Schedule E (for real estate generating businesses).  Your CPA didn't tell you that???

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

Not much if you have an umbrella policy.  I would only use LLCs and/or S-Corps if there are 2 or more members along with an operating agreement and a bank account for the entity. 

 

[socal78]

My eyes!  :'(

 

[qwerty]

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

in theory, if your properties are in an LLC, you dont need an umbrella policy for the purpose of covering yourself against liabilities against the LLC, that is the point of the LLC, since the LLC is liable (one of your renters slips and breaks their neck, it is only liable to the extent it has net assets, then you can just bankrupt it.  I would put each property in a separate LLC so an issue with one property doesnt bring down the other properties (especially if you have equity) - this is where World Chaos' holding company strategy can help. you can have the holding company wholly own each LLC. 

 

[Crispy3]

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

in theory, if your properties are in an LLC, you dont need an umbrella policy for the purpose of covering yourself against liabilities against the LLC, that is the point of the LLC, since the LLC is liable (one of your renters slips and breaks their neck, it is only liable to the extent it has net assets, then you can just bankrupt it.  I would put each property in a separate LLC so an issue with one property doesnt bring down the other properties (especially if you have equity) - this is where World Chaos' holding company strategy can help. you can have the holding company wholly own each LLC.

Yep but I have been told that's a little extreme and it can get expensive real fast. My umbrella policy costs less than $500 a year. I never transferred the properties to my LLC yet since I still plan to refi soon. Just rening and operating under the LLC.  If there isn't much to be gained with having an LLC on top of the umbrella then I might just dissolve it this year...

 

[qwerty]

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

in theory, if your properties are in an LLC, you dont need an umbrella policy for the purpose of covering yourself against liabilities against the LLC, that is the point of the LLC, since the LLC is liable (one of your renters slips and breaks their neck, it is only liable to the extent it has net assets, then you can just bankrupt it.  I would put each property in a separate LLC so an issue with one property doesnt bring down the other properties (especially if you have equity) - this is where World Chaos' holding company strategy can help. you can have the holding company wholly own each LLC.

Yep but I have been told that's a little extreme and it can get expensive real fast. My umbrella policy costs less than $500 a year. I never transferred the properties to my LLC yet since I still plan to refi soon. Just rening and operating under the LLC.  If there isn't much to be gained with having an LLC on top of the umbrella then I might just dissolve it this year...

It's all relative right, it's extreme and expensive until you get hit with a multimillion dollar lawsuit. But remember, it's just like a different form of insurance. But I understand what you are saying. Rental income margins can be tight and all the administrative expenses can add up fast. In your case, if the title is not in an an LLC then I don't see much benefit, since you still hold title, you would still be liable, I pay several hundred for a million dollar umbrella policy, so I'm assuming yours is several million since your paying 500 for it - hope your never in a situation where u have to use it.

 

[Crispy3]

Oh I knew that single member LLCs are pass through it was meant to be a statement not a question.. I am just wondering if I should even have a llc at all for my income properties... I have a huge umbrella as well.. what do I gain for having the llc besides the pleasure of writing uncle sam a check for $800 a year?

in theory, if your properties are in an LLC, you dont need an umbrella policy for the purpose of covering yourself against liabilities against the LLC, that is the point of the LLC, since the LLC is liable (one of your renters slips and breaks their neck, it is only liable to the extent it has net assets, then you can just bankrupt it.  I would put each property in a separate LLC so an issue with one property doesnt bring down the other properties (especially if you have equity) - this is where World Chaos' holding company strategy can help. you can have the holding company wholly own each LLC.

Yep but I have been told that's a little extreme and it can get expensive real fast. My umbrella policy costs less than $500 a year. I never transferred the properties to my LLC yet since I still plan to refi soon. Just rening and operating under the LLC.  If there isn't much to be gained with having an LLC on top of the umbrella then I might just dissolve it this year...

It's all relative right, it's extreme and expensive until you get hit with a multimillion dollar lawsuit. But remember, it's just like a different form of insurance. But I understand what you are saying. Rental income margins can be tight and all the administrative expenses can add up fast. In your case, if the title is not in an an LLC then I don't see much benefit, since you still hold title, you would still be liable, I pay several hundred for a million dollar umbrella policy, so I'm assuming yours is several million since your paying 500 for it - hope your never in a situation where u have to use it.

I kept telling myself that I need to change the titles to the LLC but I keep refinancing cause rates keep coming down.. I didn't want to keep moving it around so they were actually only under my name.. the rental contract was made with the LLC though.

 

[qwerty]

one thing to consider though about dropping your property's title into an LLC - i believe under most loan arrangement, if not all, the change in title allows the bank to call the loan and make you pay it all at once. from a practical perspective though, ive never heard of a bank calling the loan in that scenario.  as long the monthly payments are being made nothing would ever come to their attention.

 

[gld2]

a question of Umbrella insurance:

do i have to have several rentals to get the umbrella insurance?  which insurance company offers good umbrells insurance with a cheap rate?  Thanks

 

[usctrojancpa]

a question of Umbrella insurance:

do i have to have several rentals to get the umbrella insurance?  which insurance company offers good umbrells insurance with a cheap rate?  Thanks

Nope, you can get an umbrella liability policy without an rental properties (you may have to have auto coverage and the liability coverage on that have to be set to the max).  Just like with all insurance products, shop around (maybe your home and auto carrier might give you a better rate than other carriers).

 

[qwerty]

an umbrella policy is just a rider for additional coverage above and beyond your existing coverage. Some insurance companies make you raise your existing limits before issuing you an umbrella policy.  So if you have car insurance with the typical 100/300 coverage they may make you increase it to 250/500 then they will issue you an umbrella for say $1M of additional coverage for $200-300.  Which of course reduces the insurance companies chance of ever using the umbrella for a payout.  I use Farmers.

 

[daedalus]

Just adding a data point here.  I just locked in a refi.  30 year fixed jumbo conforming @ 3.75% with $5k *credit* to closing...covering all costs plus helping to fund the impound account.  Keeping my fingers crossed on the appraisal!

Furthering the data points...I *think* we finally closed our loan last week.  At the very least I know our old mortgage account is closed.  I ended up having a very negative experience.  In the end, aside from it taking way longer than it should have, I got most of what I thought I would, but Amerisave did not make it easy or pleasant.  Here is a list of some of my gripes:

Phone calls most often went unanswered.  Messages went without reply.  Same for emails. 

There were no commitments on dates (I asked repeatedly) or any sense of urgency on their part.

Initially I was told an in-process kitchen cabinet replacement would not need to be completed, but this ended up being a lie.  I expected it would be a requirement, but when they said "no problem", the project went to the back burner.  I had to take off from work to get it done since, at that point, I had less than 2 weeks.

Initial rate lock expiration was 9/10 (60 days); I found out on 9/26 (after week-to-week lock extensions) I did indeed have to get the kitchen completed.

This work required a follow-up for the appraisal, to the tune of $175 against the credit.

Right before closing they tried to reduce the closing credit on me, claiming I was the reason they kept having to extend the rate lock.  I sent a very stern and very fact-ridden letter to them.  I cited some of the emails and calls made.  I reminded them, among other things, that they still did not have all of their ducks in a row (in October!), and that this really should have been a complete slam dunk.  They backed off immediately, and things really moved fast at that point.  I wonder if my reply finally got past the schlep, er, I mean rep that I was wasting my time with.

Others have mentioned how silly the underwriters are with their requests for "explanations".  We had our fair share.  The most annoying thing was they kept asking for things we had already provided.  They asked us to explain a $900 deposit (REALLY??  I make THIS much a month, I'm borrowing THIS much for 30 years, I have THIS much in net assets, and you want me to explain a $900 "large sum deposit"?? ???).  They wanted us to explain addresses that showed up on our credit reports (You're saying you don't know how to read a credit report?  No problem, I guess I can google them for you and figure out which banks they belong to ).

I'm reminded of the Seinfeld "soup nazi", who exposed an interesting facet of human nature.  No one likes the soup nazi, but most people will put their principles aside to enjoy his yummy yummy offerings.  I hate the thought of ever doing business with Amerisave again, but in all honestly, if they dangle that yummy yummy carrot in my face (say, in 6 months?), I'll probably go after it.  If a friend asks for advice, though, I"ll tell them to avoid Amerisave like the plague.  Disingenuous?

 

[zubs]

When I started looking for a home, I cleaned up my main bank account so salary deposits were the only big deposits in the transactions.  I did this for 2 months so I had atleast 2 months of a clean statement.  If you are looking for a house and need a mortgage, I would suggest cleaning out your main bank account and getting all the money into it first.  Then just use another bank account if you have a non normal transaction over $500.

 

[irvinehomeowner]

Man... you guys are ballers with your off-shore Cayman Islands bank accounts.

 

[usctrojancpa]

The lender will only see the bank account that you give them.  Obviously you'll need to give them the account/s where your payroll deposits go.  I have a few bank accounts and only provided the statements for where the majority of my income goes into.  I refi'ed with PenFed for a 5/5 ARM with a 2.75% rate at 0pts and no refi costs (they pick up all of your costs if you use their escrow/title company).  It went pretty smooth just took a while because they were backed up with other refi's and purchases.

 

[changm55]

my originator told me not to include foreign bank accounts... if i do include it, itll raise red flags with the lender cause they will want to know if u are in debt in the caymans or what nots... so if u dont, then theyll just assume ur 100% domeestic and take the info you provide as it is... they also told me only to include business accounts if you own 100% of the business... if u own less then 100% then they will want more info on the business and who the other owners are and what nots, and even with that, they can only accept a certain amount within that business account to count towards ur assets... i dunno i forgot the specifics so im not 100% sure though since its been a month since the last time i talked with my originator about this

srsly getting alzheimer or something, cant remember anything well past yesterday =_=;;...

 

[Crispy3]

Just adding a data point here.  I just locked in a refi.  30 year fixed jumbo conforming @ 3.75% with $5k *credit* to closing...covering all costs plus helping to fund the impound account.  Keeping my fingers crossed on the appraisal!

Furthering the data points...I *think* we finally closed our loan last week.  At the very least I know our old mortgage account is closed.  I ended up having a very negative experience.  In the end, aside from it taking way longer than it should have, I got most of what I thought I would, but Amerisave did not make it easy or pleasant.  Here is a list of some of my gripes:

Phone calls most often went unanswered.  Messages went without reply.  Same for emails. 

There were no commitments on dates (I asked repeatedly) or any sense of urgency on their part.

Initially I was told an in-process kitchen cabinet replacement would not need to be completed, but this ended up being a lie.  I expected it would be a requirement, but when they said "no problem", the project went to the back burner.  I had to take off from work to get it done since, at that point, I had less than 2 weeks.

Initial rate lock expiration was 9/10 (60 days); I found out on 9/26 (after week-to-week lock extensions) I did indeed have to get the kitchen completed.

This work required a follow-up for the appraisal, to the tune of $175 against the credit.

Right before closing they tried to reduce the closing credit on me, claiming I was the reason they kept having to extend the rate lock.  I sent a very stern and very fact-ridden letter to them.  I cited some of the emails and calls made.  I reminded them, among other things, that they still did not have all of their ducks in a row (in October!), and that this really should have been a complete slam dunk.  They backed off immediately, and things really moved fast at that point.  I wonder if my reply finally got past the schlep, er, I mean rep that I was wasting my time with.

Others have mentioned how silly the underwriters are with their requests for "explanations".  We had our fair share.  The most annoying thing was they kept asking for things we had already provided.  They asked us to explain a $900 deposit (REALLY??  I make THIS much a month, I'm borrowing THIS much for 30 years, I have THIS much in net assets, and you want me to explain a $900 "large sum deposit"?? ???).  They wanted us to explain addresses that showed up on our credit reports (You're saying you don't know how to read a credit report?  No problem, I guess I can google them for you and figure out which banks they belong to ).

I'm reminded of the Seinfeld "soup nazi", who exposed an interesting facet of human nature.  No one likes the soup nazi, but most people will put their principles aside to enjoy his yummy yummy offerings.  I hate the thought of ever doing business with Amerisave again, but in all honestly, if they dangle that yummy yummy carrot in my face (say, in 6 months?), I'll probably go after it.  If a friend asks for advice, though, I"ll tell them to avoid Amerisave like the plague.  Disingenuous?

my god.. I am going through the same thing... endless LOX for deposits and asking for items that I have already provided. I am scheduled to close NEXT Monday and I still have not gotten a undewriter approval nor any date commitments. They just sent the appraiser out again on Tuesday (actually I called the appraiser up and made the appointment myself cause they are slower than pregnant banana slugs) just to take a picture of the carbon  monoxide detector the seller installed. I am pulling my hair out as the seller has a all cash backup offer and I cannot miss the deadline. I honestly think they are intentionally delaying things to charge me extra fees like a rush fee to close. My fico is 804 and has enough in the bank to buy the place in cash, I should be the ideal person to lend to. This is the worst lending experience I have ever gone through... I would not recommend Amerisave to anyone. 

 

[usctrojancpa]

I would never recommend anyone go with Amerisave for a purchase, only for a refi when you can wait it out to get the bottom rate.  Even PenFed took over 2 months to close my refi.

 

[ps99472]

So looking to refi again...here's my current quote

5/1 Jumbo ARM 2.875% with no closing costs (app and appraisal fee refunded at closing), no impounds, 57 day lock, primary residence, FICO 760+

Interest I'll save around $100 per month versus my old mortgage.. plus I'll get to cash out my old impound account for more liquidity.  No cost plus lower rate should be a no brainer..

Lender is a zillow broker which will be serviced by wells fargo or chase.