Posted by chris on September 18, 2009 at 11:38:43:
The property is in PA, seller is in Georgia. Also the attorney is discussing the transfer tax amount possibly being questioned by the state because sale price is next to nothing, assessed value is 36k so he is considering escrowing each party 1% transfer tax until he gets feedback from the state…after closing.
With the trust, I was under the impression there would not be a transfer tax because there would technically be no sale. How do I address this is not a way to avoid paying transfer taxes?
first trust purchase…please advise - Posted by chris
Posted by chris on September 18, 2009 at 11:32:02:
I am purchasing home in trust for the first time. The atty I am dealing with is unfamiliar. I just wanted to make sure I am accurate with how it is done.
seller conveys property to Land trust under a warranty deed to trustee for 1 dollar. On the same day(is this a necessity?) the assignment of beneficial interest in land trust is completed by the new trustee. Is the following day an option or a bad idea?
How or when do you pay for the home as a buyer? What document should accompany payment?
If I am correct there would not be a HUD-1 is that correct?
Are tax payments on the house typically prorated?
I have invested in homes many times, but it has been a closing at the atty’s office. I am now wondering since I just provided all the paperwork to the atty why I don’t just have the sellers complete a warranty deed from now on. Am I missing something here? What are the pros and cons. At this point between preparing the deed and my fees for the “closing” seller and I are paying $700.
The seller is out of state on this transaction, so I don’t want to do this first one blind.
Any advice is appreciated.
atty is telling me I must pay transfer tax. - Posted by chris
Posted by chris on September 18, 2009 at 13:53:57:
Property is in PA. Atty is telling me “most likely” will have to pay transfer tax. I am ok with that. The purchase price is under 5k so it would be $100. But it does make me wonder - doesn’t the trust allow there to in essense not be a transfer, therefore no transfer tax? I would rather pay $500. in this case than a small amount making the purchase price obvious.
was going to put bus. partner as trustee? - Posted by chris
Posted by chris on September 18, 2009 at 11:44:39:
Bad idea?
corp search online would show the bus partner name and my own under our company name.
Relatives don’t understand it enough to put their names under it, so they are scared. I will later form an LLC (in next month) to be beneficiary of the trust.
Oh one other thing for this house it will be a flip.
Business partner doesn’t have a lot of equity in props, but does have 4. Equity in those properties is next to nothing.