investment partnerships - tax deeds & private loans - cama...
Post on 19-Jul-2020
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Bio
Background:Background:Sam Stinnett is a CPA and Georgia real estate broker with 20 years experience. He is also an avid self-directed IRA investor. He has been
involved with more than 2000 real estate transactions as an investor in the Metro Atlanta Area with transactional volume of well over $200M. His real estate investments include commercial and residential properties, including brokering deals, originating private mortgages and acquiring tax
deeds. Prior to investing in real estate, Sam owned his own SAP consulting firm servicing several Fortune 100 clients such as Disney, MCI, Halliburton, and Lucent Technologies. Prior to SAP Consulting, Sam was a CPA with Ernst & Young. Sam graduated from the University of
Kentucky with a degree in Finance and Accounting. Sam was the team captain of the University of Kentucky Men's Tennis Team that won the 1992 SEC Championship. Sam resides in Atlanta, GA with his wife Wendy and 2 kids - Will (10 yrs old) and McKenna (5 yrs old).
Real Estate Investing activitiesTax Deed InvestingHard Money Loans
www.IRAPartnerships.com
Sam StinnettS @Sti ttH ldiSam@StinnettHoldings.com
Cell 404-229-8004
Tax Deeds in Georgia
•Proprietary Systems•Experienced Management
Metro Atlanta Real Estate
•Experienced Management
Delinquent Taxes Tax Lien Investment Period12% annual interest
Tax Deed
Sheriff Sale of FiFa
Tax Lien (FiFa) Either Held by County or Sold to 3rd Party
Vesta/JP Morgan/Fortress1st Tuesday each
Month on Courthouse Steps
Redemption Period1 Year – 20%
Penalty – For any amount of time –
Tax Deed Issued to Investor
amount of time –Add’l 10% for each
new year
Quiet Title ProcessApprox $4-8kpp $
Potential Upside to Sale of Property
Recorded in CountyDeed Books
Tax Deed TimelineTax Deed Timeline1 year
k
1 year Mark + 45Purchase Date –
mark
20% Redemption Return
Mark + 45 Days
30% Redemption Return
Cashier Check
Quiet Title Suit
Barment NoticesSent via personal
service
Former Parties in Chain of Title are Forever
Barred from Redeeming.
Tax Deed Purchaser has Title to the
Within 30 Days usually Tax Deed Recorded by
County Clerk in Investors Entity Name
has Title to the Property. For Title Insurance Purposes
most selling companies will obtain a Quiet Title
on the Property.
My objective – 20% Redemption as quick as possible
High profile targets Properties with large mortgages on them with National Regional or Local LendersHigh profile targets – Properties with large mortgages on them with National, Regional or Local Lenders
Why Tax Deeds?y•20% Redemption Fee – Day 1
•Favorable laws in Georgia for Tax Deed Sales
•Tremendous chaos in the Mortgage Industry with Foreclosures & g g ySecuritization
•US Consumer in tremendous debt and if there isn’t an escrow account then property taxes fall to the bottom of the listthen property taxes fall to the bottom of the list
•Georgia Counties are strapped for cash and are quickly selling properties to recoup their tax dollars
2258 Lake Ranch Ct
•$40k Profit in 20 Days – 20% GA Tax Deed Statutory Return
•$200k Investment•Lake Lanier (Hall County) – Atlanta’s main Lake•Tax Value of $329k•$928k CitiMortgage in April 2007•Foreclosed for $447k in Sept 2010
3475 Oak Valley #2330
•$20M Profit in 57 Days – 20% GA Tax Deed Statutory Return
•$100M Investment•Heart of Buckhead – Atlanta GA•Tax Value of $296M•$218M Wells Fargo Mortgage
226 Long Dr, McDonough GA 30253$55M Purchase Price•$55M Purchase Price
•In Rem Judicial Sale•Special Tax Deed•All Liens are cleared60 Day Redemption•60 Day Redemption
Period without Interest•After 60 Days can Sale Property for Market Value
•Sold 2/20/10•35% Absolute Return for Investors•$40M Net Profit on $55M Investment•80 Day Investment Cycle
2832 Havenwood Dr, Conyers GA 30094
Tax Deed Purchase $65,000
Payoff in 36 Daysy y
Check from US Bank $78,000
$13,000 Profit split betweenInvestor and ManagerInvestor and Manager
9764 Sinclair Lane, Jonesboro GA 30238
Owned Melrose HomesDeveloper with HugeWachovia Mortgage
Tax Value $182,077Lowest in Subdivision $115k
Paid $42,700 Feb 2010
Wachovia Payoff $51,240
Investment Cycle 3 months
770 County Line Auburn RdWinder GA 30680 – Barrow Co.Winder GA 30680 Barrow Co.
BB&T $400,000 ForeclosureF b 2010Feb 2010
Purchase Tax Deed June 2010$50,000$ ,
Paid Off $60,000 16 days later
2300 Holcomb Bridge Rd
.41 AcresZoned C1Only entrance to Public Storage FacilityTax Value of $685,000
Purchased Sept 2009 $40 000Purchased Sept 2009 $40,000Payoff of $48,000 in Aug 2010
Sample Current Deals2010 $9 000Purchased July 2010 $95,000
Brand Bank Mortgage $400,000Currently listed FMLS $295,000
Failed Restaurant3 A3 AcresRBC Mortgage $740kPurchased $115kAugust 2010Receiver for RBC Called me 15 days later –he was just appointed
Tax Deed Risks
O f T D d th i fi b l b t•Overpay for a Tax Deed - there is a fine balance between paying as high a price as possible because the redemption fee is based on this amount paid but paying a low amount if you are going to ultimately own it Experience shows that 90% of thesegoing to ultimately own it. Experience shows that 90% of these Tax Deeds redeem on nice properties.
•Property Damage – Fire/Tornado/Vandalism – InsuranceProperty Damage Fire/Tornado/Vandalism Insurance Protection
•Liquidity – Owner or mortgage holder could file bankruptcy and q y g g p ythis would slow down the redemption/barment process
Tax Sales – ‘The Law’Example 10 Page Tax Sale Documentationby Cobb County Tax Commissionery y
http://www.cobbtax.org/Forms/pdffiles/taxsales.pdf
Simple 1 Pager
http://www.cobbtax.org/forms/htmlframe.aspx?mode=content/delinquent_taxes.htm&LMparent=189
https://etax.dor.ga.gov/ptd/adm/taxguide/ocga.aspx
Title 48. Revenue and Taxation
Chapter 4 - Tax SalesArticle 1 - Sales Under Tax Executions 48-4-1. - 48-4-7.p
Article 2 - Purchase by Counties 48-4-20. - 48-4-23.
Article 3 - Redemption of Property Sold for Taxes 48-4-40. - 48-4-48.
Why Private Loans?y
•Favorable laws in Georgia for Mortgage Holders Non Judicial•Favorable laws in Georgia for Mortgage Holders – Non Judicial Foreclosure State
•Tight Credit Market – borrowers are forced to utilize private money while g yputting up a lot of collateral
•Loan to Value – 50 to 65% - We structure the deals – Loan to Own –Make it pain if someone is going to walk awayMake it pain if someone is going to walk away
•Loan Origination Fees – 6pts or minimum $4k (great for these 25k Loans)
•Interest rates of 16% for the first six months and 30% thereafter
www georgiaprivateloans comwww.georgiaprivateloans.com
3414 Skyview Dry
Borrower is Self Employed with Multiple Real Estate pProperties on his credit history
Sales Price $92kBuyer Downpayment $20kLoan Amount $72kAdditi l C ll t l 2 F d Cl D l I l d th t $20k EAdditional Collateral – 2 Free and Clear Duplexes – I valued them at $20k EaPersonal Guaranty$6k Origination Fee & 16% Interest
218 Pine Barren Rd
Borrower is Self Employed
Property Owned Free and ClearTax Value of $275kL A t $31k
and Needed to Consolidate some debts
Loan Amount $31kAdditional Guaranty – Personal Guarantee$4k Origination Fee & 16% Interest
Investment PartnershipspOwned 100% by Investor – Either IRA Funds or Non Retirement Funds
Special Purpose Entity for Tax Deed Purposes & Private Loans
Entity owns 100% of the Assets – Cash, Tax Deeds, Loans
Entity has no leverage
Sam Stinnett – Co Manager of Entity –has signing authority and ability to obtain Cashier ChecksProfits
Split 50/50 with Investor A d M
Bank Account with SunTrust Bank for Rural County Cashier Checks
And Manager
O CNo Overhead charges in LLC or Salaries. Only direct charges related to the investments. Monthly financial reporting by Manager to Investor.
Alignment of Interest – Manager doesn’t get paid until Investor is paid
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