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  • #46
    Tax Liens, Richmastery and GRA

    Surely no one believed the gibber gabber of Phil Jones from Richmastery. First he brought us property teachings to purchase cashflow property in a cashflow positive starved market. Ticket price to the academy = $3000 circa. Secondly he provided property and arranged finance for us through Blue Peak, another of his creatures. Ticket price = over inflated property prices paid by hundreds of people. Finally he brings us tax liens. Ticket price to course together with LLC and bank account = $4000 circa. No mention of forex and tax risk except by Mr Gilligan and GRA. Ticket price paid by GRA = public criticism of a professional firm who are only interested in informing clients of the disadvantages of this latest scheme. Ticket price paid by the unfortunates who take up the scheme = $ pricelist. Baby Bear

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    • #47
      gibber jabber

      I like that, reminds me of Mr T.

      Quite a few people fell for the jibber jabber unfortunately

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      • #48
        From Dorien's site:

        American Tax Liens

        We had our last Multiple Finance Strategies course for the year last weekend. (If you missed out don’t worry, it is available as part of our Home Study product range). As usual we laughed a lot and had some very interesting discussions about the current property market, also about world wide opportunities being offered through the global economy crisis.
        It included a lot of talk about American Tax Liens. This is a US Government backed program involving American property taxes, which is the equivalent of our rates. In the States if the home owners don’t pay their rates, the Government offers a system that allows other investors to pay the rates and eventually maybe even take ownership of the house.
        Overseas investors are welcome, so Rineke and I have looked at the idea of pioneering it in NZ as we have done with other strategies such as Lease Options. Tax Liens are a great system for good return on invested money 16-24% or more because they are government guaranteed. However, as a strategy for acquiring property there are a few challenges.
        • It is a bit of a lottery game whether you do or don’t eventually get a property. This part in NOT guaranteed.
        • For property laws US States are either come under regulations of being a Trust State or a Mortgage State. (NZ is equivalent to their Mortgage State) The different states have different laws around the redemption process for the current owners of the property, and you really need to get very familiar with the specific property laws of the States you are dealing with. The redemption process varies from 6 to 24 months depending on the regulation of that State.
        • You have to be able to thoroughly research the title of the property. There are plenty of horror stories from investors who have not ended up with the property they thought they were dealing with. Just one little reference number can make a big difference. One colleague of ours thought he was dealing with a nice three bedroom coastal home in a good suburb, only to find it was actually a bit of useless swamp land.
        • As you can imagine the Tax Liens system is very popular in the States and there are plenty of “professionals” who do this full time. Some states are more popular than others. Texas and North Carolina are both very good. A friend of ours who was seriously thinking about doing this full time said that although there are many online services offering help, his research indicated that the serious investors still prefer to turn up in person to pick up the best deals. He went to North Carolina but came back to LA saying he felt he couldn’t compete with all the ‘local experts’ who used specialised knowledge to get ahead of the pack.
        • If Lady Luck is on your side and you are successful in acquiring a property, than management may need consideration. At the moment there is a chronic shortage of GOOD property management services in the US. Some of the sheriffs who normally evict tenants are now refusing to do so, when it is the landlord that is defaulting on the mortgage or other payments. So if you become the owner of a property through tax liens, which is tenanted you may need to have further strategies in place to deal with management.

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        • #49
          Probably a good time now dean to say if you are going to promote this business yourself in the future. We have seen you do this with other courses. What is different this time.

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          • #50
            As I've never done that I'll leave you to your tiresome fantasies Fox.
            What a stupid question.

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            • #51
              Great article on the state of the US market http://www.nytimes.com/2009/03/30/us/30walkaway.html?em if the banks are even running away, what about a poor punter in NZ

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              • #52
                A great place to talk to people in the US about this stuff is twitter.

                It's a weird platform but it's very easy to connect to a lot of people and get a real good idea from people over there in the field.

                www.twitter.com/tpr2 is my handle and I am following about 400 real estate people in the states. Good sources of information.

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                • #53
                  Anyone had a positive experience with the 2 day RM tax lien course and is using info successfully? How easy is it to get up and running?

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                  • #54
                    I have a string of people who feel ripped off. Haven't yet heard a success story.

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                    • #55
                      oh dear, do you mind elaborating pls? I went to the seminar last night, and found it pretty interesting, but have a hunch it is complicated paying tax, structuring correctly etc....can find very little info on web, mostly would like to talk to someone who has done the course, what they thought of it, hidden costs to get up and going etc... what have you heard?

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                      • #56
                        PLus this info from this thread of course

                        Commercial Alert From GRA on Tax Liens

                        I think tax liens are going to end up being a problem, for several of reasons but primarily because of the exchange exposure.

                        A fluctuation in exchange will cause issues for investors:-
                        1. A gain - pay tax on an accrual basis before you receive a return
                        2. Loss - real exchange losses

                        Hedging the exchange risk is too costly, eroding the return.

                        Unless you invest serious dollars, there does not appear to be cost benefit.

                        To be frank, I think Tax Liens are high risk due to the cross boarder issues and I am recommending to my clients not to got there. Jones/Richmastery overselling them and underestimating risk.


                        To investors, I say model your gains, and factor in compliance cost in the USA ( US$1500 according to RM tax attorney Larry LOFTIS), cost of the RM data, potential USA tax, exchange translation costs, additional tax planning costs to mitigate the tax, - add it up. Your working hard to recover the costs from your interest earnt on the lien.

                        Tax liens are great for a local investor in the USA - with no exchange exposure and whom already pays local compliance costs. Further the issues are local - they can drive or fly down the road, and sort out the issues. Not so from NZ.

                        You need to invest a minimum of NZ$100k to dilute the transactional and compliance costs, - and then you carry the exchange risk.

                        Tax Avoidance
                        Jacking up interest charged from NZ to your USA LLC - this is what Jones is recommending to stop paying tax in the USA. This is tax avoidance, no question. And there are rules on thinly capitalaised companies preventing this in the USA. Both IRD and the IRS will be concerned about this.

                        Hyperinflation
                        Another thing - what if we see hyperinflation ? At a presentation this evening a friend of mine asked Dr Bollard if we may see Hyperinflation again, which is something I'm worried about. Dr Bollard said it is a distinct possibility with the US printing cash and now Britain - its not hard to see this happening this year. What will this to the USD ? No one knows. Will it go to 10c against the Kiwi if inflation/interest rates sky rocket ? or 90c ? Will the USD stay the reserve currency if this occurs ? I don't want to be alarmist but these are uncertain times.

                        We have cash flow in our back yard with a property market that has melted down. There will be a truckload of mortgagee sales this year, and some real bargains. Well worth looking at.

                        Commercial Alert
                        I say don't go there. I am putting out a commercial alert - I think these things are risky and PJ is underestimating the risks.

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                        • #57
                          thanks for your advice. Back to trawling trademe for cheap properties i guess..... Damn, it sounded so good!

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                          • #58
                            obama's Off Shore Investors' Surprise

                            Today the administration announced new tax regulations for offshore investors trying to take advantage of the American market, particularly as it applies to investment profits from offshore owners or offshore entities.

                            These tax liens look awfully speculative and subject to inordinate returns for rich speculators. Any investor trying to repatriate profits is in for an expensive nightmare. Lawyers and accountants are on notice to turn in clients who are abusing the rules or their licenses could be in jeopardy.

                            Funny how a stroke of the pen and a need for tax revenues can eliminate a well hyped dream.

                            Best: Andrew Waite - Personal Real Estate Investor Magazine

                            PS: They are also aggressively going after scoff laws and tax cheats who hide behind bogus shells and tax havens. The statutes of limitation have been extended to 10 years so expect a lot of back peddling and "geographic arbitrage" from the so called market wizards.

                            Tax departments the world over have found a new source of revenue that no one is complaining about....going after tax cheats....as they care considered unsympathetic social parasites.

                            In the US they are offering rewards to whistle blowers!

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                            • #59
                              Hot off the Andrew Waite/Nexzus Publishing Press :-)

                              Donald Trump has gotten a bunch of negative feedback about their inclusion as endorsing the Jones/Eckelman Tax Lien seminars in NZ and Australia . It has reverberated to Trump name licensee, Trump University who are most sensitive about the fall out.

                              One call was from an expat New Yorker living in Australia who was blown away by the fact Eckelman held himself out as a Donald Trump’s largest tax lien buyer, (even though Trump has never bought any). This got back to Trump’s assistant.

                              Trump University has Eckelman on their faculty as a tax lien pitchman. He may not be an expert but he can sell from stage and produce substantial back end revenue splits so they keep him on.

                              Eckelman denied he had claimed to buy tax liens for Trump, or Bill Clinton or Evander Holyfield, even though he said such from stage, (independantly corroborated in each case). To retain his salesman position he stated....

                              “I am no longer associated with Jones” as apparently the experience was not positive".

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                              • #60
                                Originally posted by Dean Letfus View Post
                                I have a string of people who feel ripped off. Haven't yet heard a success story.


                                Hi Phil/Tommy/Team,

                                I'm really excited to be letting you know that I actually purchased my first Tax Deed at the Palm Beach Live Deeds Auction held today (1st July)...

                                We arrived into West Palm Beach last night after our jaunt across the US and our flights from NZ on Monday and I managed to get some final bits of research and updates done online to prepare for the sale today and double check statuses on the ones I was interested in etc. Unfortunately for me/fortunately for the homeowners, several that I had earlier had my sights set on and done due diligence on were redeemed prior to the sale so the starting sale list of 73 got whittled down to just 9 properties by last night...

                                I had one option that was in within my budget and the numbers stacked up quite nicely so headed to the sale anyway to check things out, not holding out much hope of a successful outcome. Anyway, turns out, the room full of potential competitors were all mainly along for the ride so lucky for me/us, I was the only bidder on the parcel I wanted so won the deed at $3,420.00!

                                I initially thought I was purchasing a 3 bdrm/2 bthrm property with an 2008 Value of $234,000 however it turns out, the homeowner had done a "unity of title" on the adjoining plot of land he also owned so the entire parcel I bought actually also includes a 2nd property at the rear of 2 bdrm/1 bthrm. Total lot size is pretty sizable at 13,000+sqft with the two properties sizing around 4,000sqft together. I've been advised by another investor here that I met at the sale that the actual value for the whole site would be well over $560k retail basing it on the standard price for the area of $140/sqft. We're working with him to onsell it quickly though his database of investors (about 200 people) so are listing it at $350k to see if we can get some quick movement on it. In the meantime we've also met the current occupants (tenants) of the 2 properties and are going to be doing new lease agreements with them in the morning so will be collecting a monthly rent of $2,100 from them in the meantime until we onsell. There is a bit of a potential glitch on the horizon with the previous homeowner attempting to stir things up a bit by claiming to the tenants that "we don't own the actual property, only got the deed not the real property ownership etc etc and is threatening them that he will try and shortsell it out from under us etc etc".

                                I will be speaking to Titlemark tommorrow to double check on this and get them on the case to expediate the title clearance asap so hopefully things will run smoothly for us from there.

                                Anyway, wish us luck eh?! Will be nice to head back to NZ next week knowing we have a tidy sum heading our way very soon!!! Will keep you posted... in the meantime, have also attached a few pics of the properties we purchased today.


                                Thanks heaps,

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