Attorney William Bronchick: William Bronchick Best-Selling Author

WilliamBronchick : Too many investors go to closing and sign documents without ever reading them, taking the word of the “professionals” involved in the closing. This is a huge mistake unless that professional is your lawyer, and he or she has read and understood the loan documents. Don’t presume that the lawyer you are paying represents you. Many banks have lawyers that represent them and charge that fee to the borrower. Mortgage brokers and lenders are not by their nature dishonest but there are enough shady characters that try to slip things by on borrowers. In some cases, it is a mistake by the lender or a miscommunication between the mortgage broker and the lender, both of which result in the borrower getting a different loan than what was promised. The most common things that are incorrect on a loan are: Prepayment Penalty The most common “hidden” clause is a prepayment penalty that the lender does not disclose or that was supposed to be omitted. The only wa...

William Bronchick : Have you ever had a tenant leave in the middle of the night or the middle of an eviction? Did you ever wonder what to do when the tenant abandons the property? Basically, when a tenant abandons the property, you do not need to file an eviction or wait for the sheriff. You can change the locks. HOWEVER… If you are not certain whether the tenant has abandoned the property, you should not change the locks. If you have the keys and your lease allows it, you could enter the premises, but KNOCK FIRST. Whether or not the tenant has abandoned is often a judgment call, looking at a combination of factors, such as: ·          Did the neighbors see them move? ·          Are the utilities shut off? ·          Did the tenant put in a change of address at the post office? ·          Is there any si...

William Bronchick : You’ve seen the claims “Eliminate your mortgage!!” Can this really be true? Well, I’ve researched the law and here’s what I came up with. The Claim The claim they are making is that you can legally eliminate your mortgage based on a legal loophole that goes something like this… “If the lender who funded your loan used borrowed money to fund your loan, then the loan is not valid. And, since the loan is not valid, the security instrument is not valid either. All you do is simply march into court and ask a judge to void your mortgage lien, and you don’t have to pay it back.” Now, without going into the legal issues, a common sense approach would tell you that the entire premise of this argument is patently absurd. Think about it… most lenders use borrowed money to fund loans, that’s the nature of the business. So, if these promoters are correct, then millions of mortgages would be void. The entire economy would collapse. The...

" William Bronchick "  Any major endeavor worth doing right requires some sort of organized plan. Starting a business and getting it off on the right foot is no different. It’s amazing to me that most folks that are starting a business spend more time planning a 1-week vacation that they do laying out the steps of a business they intend to support them for many years into the future! In order to help you on your journey, we will explore 7 key ingredients that are essential in a complete real estate business plan. 1. How Much Are You Going to Invest Initially?   It’s important for business plan purposes to at least allocate an amount of money that you wish to invest at first. This can be cash on hand, savings, a line of credit, IRA money, partner’s money or other. It’s not important to have an exact amount, just a starting point. The amount can be changed as needed. 2. Entities and Principals I am always amazed in my roles as both an investor and business...

Let’s say through savvy investing, you have managed to accumulate a portfolio of properties. It doesn’t matter if it’s a large or small portfolio. You may have even tried to self- manage them yourself. Now as you procure more properties you may find you may not be as organized as you once thought and find that some things may be falling through the cracks. Possibly you are just getting tired of getting the midnight or weekend calls (or both), the whining, repairs, trying to collect rents, keeping up with the books and everything else that goes into being a property manager. For purposes of this article, we are dwelling more on single-family rentals or small multi-family units. Larger multi-family units are normally handled quite differently. On the plus side, as a budding landlord, you may find that managing your first few rentals will be a great education! However, as your portfolio grows you may find that you are repeating past mistakes such as not screening tenants properl...

 Short sale flips – the process of shorting a property then reselling it for a cash profit in a simultaneous closing has been taking heat lately from title companies and real estate brokers.  Realtor blogs are filled with drivel about how these transactions are illegal or unethical. What’s the real truth? The Basic Process The process of the short sale flip works as follows. Step 1: Investor signs a contract to buy a house from a seller who is behind in payments. Step 2: Investor contacts seller’s lender to negotiate short sale Step 3: Investor gets lender to approve short sale Step 4: Investor lines up backend buyer Step 5: Investor closes with seller, paying off lender, then resells to backend buyer in simultaneous closing for a profit. In essence, this is no different than a regular wholesale flip except instead of paying off seller’s lender in full, investor pays off seller’s lender at a discount. The Hoopla Some Realtors and title companies think the...

Capital gains, exchange rules and installment sales rules apply for properties held for “productive use.” I.R.C. §1234. If you are actively buying and selling real estate on a regular basis, you may be considered a “dealer” in real estate properties. A dealer is one who buys with the intent of reselling rather than for investment. There is no magic formula for determining who is an investor and who is a dealer, but the IRS will balance a number of factors, (See, e.g., Winthrop, Ada Belle v. Tomlinson, 417 F.2d 905) such as: The purpose for which the property was purchased How long the property was held The amount of sales by the taxpayer in that year Amount of income from sales compared to taxpayer’s other income How many deals the taxpayer did in that year The amount of gain realized from the sale “Flipper” Properties May Be Subject to Self Employment Tax If the IRS pegs you as a dealer, your properties are not “investments” but rather “inventory.” If you are flipp...

William Bronchick : Foreclosure investing can be difficult if you are not sure what to look for in bank-owned homes. There are certain learned skills that come with consistent investment in foreclosures. Let’s take a glance at what a trained foreclosure investor’s eye looks for when seeking out the best home for his or her buck. Location Just like the price of homes sold normally, different locations offer different price ranges for foreclosed homes. Depending on the budget, foreclosure investors will decide which area they want to purchase in. Usually, the bigger the price tag of other homes in the area mean the investor will make more money off of the single sale of the house. With smaller investment neighborhoods, the single sale may not be a high return, but there is usually a quicker turn around on the sale. Some investors only secure funds for short periods of time, which means the house needs to be flipped and sold quickly. This would call for a smaller investment n...

William Bronchick : The first thing that should be noted is that flipping houses is a great way to bring home a rather large profit in a relatively short amount of time when doing so in a seller’s market so to speak. The problem is that we currently seem to be experiencing what is known as a buyer’s market from one end of the United States to another. Foreclosures are at an all time high, which means that the market has suddenly been saturated with properties for sale. While this is excellent news (believe it or not) when it comes to getting your hands on a property at a lower price, it also makes a difficult time of convincing buyers to pay top dollar when there are better bargains down the road. This of course is one of the primary risks involved in the real estate investment venture that is known as flipping properties. The massive profits that most investors seek cannot be accomplished if the property cannot be purchased, rehabbed, and sold quickly. Unfortunately, at the ...

William Bronchick : Taxes are your biggest expense in your lifetime, so choose your source of income wisely! Real estate has some of the BEST TAX BREAKS of any investment in America! The more you earn through your job, the more you get taxed, and the system is setup that way to punish hard workers and reward investors.  Have you looked at the bottom stub of your paycheck lately and seen how much the government steals from you?  Wage income not only requires work, it gets taxed at a very high rate, plus the government takes FICA, which is put into a system that may be bankrupt when you retire. Real estate has so many tax advantages over wage income: Capital Gains Rates The maximum federal tax rate on capital gains is 15%, whereas wage income is taxed at 35%.  There’s state taxes, too, and some states offer further discounts on capital gains income.  Remember, capital gains requires that you hold a property for 12 months or more before selling, as in th...

When you decide to start your career as a new real estate investor you have to follow many tips and strategies that will help you to become successful. And often you commit mistake at your beginning stage. Thus for this William Bronchick has tried come up with 5 mistakes out of his experience and attorney help, that you can mind in reducing your mistake. Here given below are the following 5 mistakes that most new real estate investors make very often time. Not Valuing Your Time Being a property director may sound simple until the point that you begin doing it. Numerous new and financial specialists think they can go only it. And decline to employ a property chief with an end goal to spare cash. Be that as it may, when the midnight crisis calls come in, you’ll end up singing an alternate tune. On the off chance that you intend to keep up an all-day work notwithstanding beginning as a land speculator it is vital you contact a property chief. Your opportunity is profitable,...

  Before we discuss the equitable interest, we need to discuss the basic owner–financed sale. When you sell a property, you give the buyer a deed to transfer ownership. If you owned the property free and clear before you sold it, you would take back a note for part of the purchase price, secured by a lien on the property (in some states a “mortgage”, in others a “deed of trust”). So, after the closing the buyer would have title (deed) and you would have a recorded lien against the property (“mortgage” or “deed of trust”). If the buyer stopped paying, you’d have to initiate foreclosure proceedings as specified by the mortgage or deed of trust. In mortgage states, the process is generally a lawsuit (judicial foreclosure), while deed of trust states the process is a “power of sale” (non-judicial) process. Before we move on to the lease option equitable interest discussion, let’s discuss the installment land contract. The installment land contract is an agreement by which the...