hard money ???? - Posted by Joe Gianni p.s.ca.

Posted by Stacy(AZ) on August 01, 2000 at 16:11:55:

Joe, you may want to post this question on Bronchick’s site.

I misunderstood when I posted a reply. I thought you were concerned about the debt looking bad on your credit history, but after rereading your post, I understand your concern. I would think that a trust would be the right answer, and Bronchick could probably clarify what to do.

Good luck-


hard money ??? - Posted by Joe Gianni p.s.ca.

Posted by Joe Gianni p.s.ca. on August 01, 2000 at 13:16:11:

I am just getting started in my RE career.I have tax liens from over 10 years ago ,which my accountant is currently working on.My ? is can I still get a loan from a hard money lender.
I’m assuming with the use of land trust,
PAC trust,or by some other means I can still get a loan.I’ve had lenders tell me ,they could not loan me the $$$$ with the tax liens.
Before I start calling other lenders,I would appreciate some advice or suggestions from you guys.
thank you,

Re: hard money ??? - Posted by dewCO

Posted by dewCO on August 01, 2000 at 22:07:14:

I’m sorry I too misunerstood your first post.

REnfrow is right, get the property out of your name, and you’ve probably not gotten to the hard money lenders. To flush out a hard money lender the question is real simple: “Do they lend based solely on the value of the property, regardless of whether the contract price is lower than the value?”

And don’t expect them to be “charitable” with their value either.

Re: hard money ??? - Posted by B.L.Renfrow

Posted by B.L.Renfrow on August 01, 2000 at 21:52:02:

As long as title to the property is not recorded in YOUR NAME, the IRS liens will not attach to the property. So the solution is to hold title in a land trust or a corporate entity, not in your personal name.

A true hard money (equity-based) lender shouldn’t care if the property is held in a land trust. Every trust agreement I have seen gives the trustee the authority to mortgage the property. And the lender’s ability to foreclose is not affected by the presence of the trust.

I suspect these lenders with whom you’ve been speaking are NOT true hard-money lenders. But I agree with Stacy about getting Bronchick’s opinion.

Brian (NY)

Re: hard money ??? - Posted by dewCO

Posted by dewCO on August 01, 2000 at 13:35:44:

The use of trusts does not get you any loan or money at all. Matter of fact lenders won’t lend money to a trustee (which is a property in a trust). Need to do it before it goes into the trust.

Tax liens take precedent over all over liens on property, hence the problem with lenders making you a loan. Don’t know about whether hard money lenders care. If they do, you need to get a private loan to pay off the tax liens, and then refi to pay back the short term loan and pull out cash, or whatever else you’re trying to do, you don’t specify. I would have yourself preapproved for the new loan before so you can prove to a private lender that it is short term. Don’t think coforming lenders will let you pay off the tax liens out of proceeds from a refi or new 1st. If no one else repdonds here, call them and ask.

Hopefully there is enough equity to do whatever you’re trying to do.

Re: hard money ??? - Posted by joe gianni

Posted by joe gianni on August 02, 2000 at 24:27:56:

I do believe I have the correct answer.If not , please correct me.I’m certain I have been talking to true hard money lenders.
From what I understand,a land trust needs to have ss# or ? ( taxpayer ID ).I would still be in the same situation.possible tax lien on my rehab.My only alternative , other than putting it in someone elses name would be to form a corporation or a LLC thanks for the responses,
Joe Gianni

Re: hard money ??? - Posted by joe gianni

Posted by joe gianni on August 01, 2000 at 13:57:06:

I am not looking for money to solve my tax prblem.I should be able to have this lien(debt) resolved within 2 months,it is not a cash problem,it just takes time when dealing with the IRS.
I intend to flip and rehab.When I rehab, I will need to borrow money.I understand the lenders concern with my situation,as the IRS can then lien any property I own.Is there anyway around this,or should I just flip until problem is resolved
thanx again,

Re: hard money ??? - Posted by JPiper

Posted by JPiper on August 02, 2000 at 24:57:51:

Form a corporation…it has a separate taxID number. You want to flip and/or rehab in a corporation anyway.

A true hard money lender should have no problem with lending on an asset owned by a corporation assuming that sufficient equity is there.

Make sure you’re talking to hard money lenders…asset-based lenders.


Re: hard money ??? - Posted by Stacy (AZ)

Posted by Stacy (AZ) on August 01, 2000 at 14:44:43:

True hard money lenders care about the property being purchased and their LTV (60% to 65%), and little or none about your credit history. If you buy right, you should be able to use hard money even with your tax lien situation.


Re: hard money ??? - Posted by joe gianni

Posted by joe gianni on August 01, 2000 at 15:56:33:

Well, I just called several other lenders and they all said no.They can’t lend on a property regardless of the equity or price if it is in my name and I have tax liens.
The people I spoke to were clueless about land trusts to circumvent the situation(as am I ).I am waiting for calls back from people who do.