Tag Archives: Plan

EquityBuild Announces Plan For Time Expiring “GO Zone” Tax Incentives

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Torrance, CA (PRWEB) September 25, 2008

Florida-based EquityBuild is a real estate investment company that is offering investors a plan to take advantage a special government tax shelter program that runs out at the end of 2008.

With the passage of the Katrina Emergency Tax Relief Aid of 2005 and the Gulf Opportunity (GO) Zone Act of 2005, Uncle Sam extended a golden opportunity to shelter up to $ 25,000 of taxable income through a generous 50% first-year depreciation deduction for residential rental property located in areas impacted by the 2005 hurricane season.

This is in addition to the normal straight-line depreciation deduction. To top it off, the allowance is deductible even against the alternative minimum tax. It doesn’t get any better than that.

But it can get worse. Congress gave this jewel-of-a-tax break a short shelf-life, setting a sunset date of December 31, 2008. “A turnkey program makes participation in the benefits of income property ownership very easy for a person like me who does not have a tremendous amount of expertise in the field,” says Ramon Blanco, a network systems analyst living in Naples, Florida. “By taking advantage of that 50% depreciation bonus, I figure we can probably save ourselves about $ 15,000 in income taxes this year.”

“I’m already reaping significant tax benefits, realizing savings both last year and this year,” says David Wilson, who resides in Charlotte, North Carolina and works in the information technology industry. “This tax savings is a very key element of the business model for the equity-building program I’m involved with.”

Turnkey specialists facilitate the tax savings

The program Wilson refers to is southwest Florida-based EquityBuild, Inc. Founded and managed by real estate investor Jerry Cohen. Having handled more than 1000 transactions within his 25 years in real estate, Cohen perfected a proprietary econometric model that identifies undervalued and outperforming markets. His EquityBuild program is one of the first and largest of its kind to link individual investors with qualifying homes in the GO Zone. As few investors have the time to hop a plane to the Gulf coast, negotiate a house purchase, renovate it and lease it before December 31, a program such as this succeeds by quickly handling all aspects of the process, from soup to nuts.

“The fact that they take care of the details is really wonderful, making it very easy to invest,” says Sue Horowitz of Naples, Florida. “As a real estate agent, I’ve done property management before, and have been involved with other investments that were horrendous. But with a program like EquityBuild I never have to worry about anything. They handle it for me.”

Of course, the foundation for succeeding with any real estate investment involves identifying the ideal community in which to invest. Any of 91 counties within the three state area will qualify for the 50% depreciation allowance, but hooking up with one that represents a good long-term investment vehicle with potential appreciation and a good income stream demands a higher level of due diligence.

In the case of EquityBuild, Cohen targeted Jackson, Mississippi as the bull’s-eye for investment success–for good reason. In 2006, Partners for Livable Communities identified Jackson as one of America’s “Top 30” communities in which to live. Considering economics only, the 2000 census pegged the median single-family home price in Jackson at $ 64,400, making it the ninth most undervalued metro region in the U.S. According to a March 2007 housing valuation report by National City Corporation, Jackson ranked in the top three percent of 317 metro areas for housing affordability.

By collecting the rents and maintaining the properties long after the initial lease is signed, these programs encourage investors to hang in for the long run. Flipping is discouraged in favor of traditional value-based cash-flow real estate investing that possesses the potential for appreciation. The fact that the investor actually holds title to each property–as opposed to a securitized interest in a pool of homes–also serves to foster a sense of ownership for the duration.

If Jackson’s appeal as a sure-fire income property location offers reason enough to invest there; the generous depreciation allowance acts as icing on the cake. To ensure that the maximum tax benefits accrue to the investor, these turnkey programs provide all the accounting information necessary to cash in on this once-in-a-lifetime tax windfall. Those who require even more assurance that every move complies with IRS regulations are usually referred to qualified CPAs who specialize in the GO Zone depreciation allowance.

“I own seven houses right now, most in Jackson, Mississippi, continues Wilson. “These tax benefits are pretty aggressive, so it’s kind of refreshing to have someone guide you. The house selection, the property management, the tax advice; all those elements are steered by EquityBuild. You only have to get a little involved in financing and signing documents, but otherwise it’s pretty hands-off.”

A Real Estate Investor wishing to take the IRS up on its offer needs to act fast.

For more information, contact EquityBuild, Inc. at (800) 261-0648 or visit http://www.equitybuild.com

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New FDIC Plan Will Help Clients of The Loan Modification Center

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Washington, D.C. (PRWEB) January 12, 2009

Sheila Bair, who was named chairperson of the Federal Deposit Insurance Corporation (FDIC) in 2006, has reiterated her view that the best approach to resolving the current housing crisis is to encourage lenders to renegotiate mortgages with homeowners.

Bair’s proposal calls for a loan modification program so that payments are reduced to 31% of homeowners’ gross income (Sasseen & Francis, 2008). The federal government would guarantee to cover part of the losses if the homeowners re-default despite this assistance. Bair claims that this approach would save 1.5 million homeowners and would cost the federal government approximately $ 24.4 billion (Sasseen & Francis, 2008).

The proposed approach has faced a barrage of criticisms and doubts. Some have claimed that the renegotiation of millions of mortgage loans will take too long to have a practical effect (Wallison & Pinto, 2008). Others have pointed out that it will be difficult to renegotiate certain types of loans, particularly those that have been securitized, or sold to investors (Sasseen & Francis, 2008). Critics have also argued that previous efforts to renegotiate mortgages have not been particularly successful. Specifically, there is evidence that more than half of the mortgages renegotiated during 2008 are already at least 30 days past due (Sasseen & Francis, 2008). Treasury Secretary Hank Paulson argues that Bair’s plan is problematic because it increases government expenditures and it rewards banks when homeowners default (Sasseen & Francis, 2008).

Alternative solutions have been proposed for the housing mess, but these too have perceived flaws. For example, bailing out the major mortgage companies might simply encourage further risky practices in the future (Murphy, 2008). Treasury Secretary Paulson claims that the best approach is to reduce mortgage rates, in order to encourage more home purchases. However, this approach has been criticized because it won’t help borrowers who are already in trouble (Sasseen & Francis, 2008). Martin Feldstein, a Harvard economist, has suggested that the federal government should make loans to troubled homeowners to cover 20% of their mortgages (Feldstein, 2008). However, this raises the risk of borrowers, in turn, defaulting on their debts to the government (Murphy, 2008). There is, additionally, widespread sentiment that helping companies or borrowers who got themselves into trouble is unfair to those who made more reasonable financial decisions.

The housing crisis came about because trillions of dollars of mortgage loans were made to borrowers who were not really able to repay the loans. Many of the loans were based on adjustable rates that greatly increased the size of homeowner payments after a certain period of time (Murphy, 2008). The situation led to a growing number of defaults and a substantial decline in housing values. The proposed solutions to the problem are based on the question of whether it is better to assist mortgage companies or borrowers. There seems to be a partisan divide on this issue, since many Democrat politicians, such as Bair, are in favor of helping borrowers, while Republican leaders, like Paulson, are in favor of helping the big companies. In spite of this controversy, there is widespread agreement among policymakers that the most important step is to strengthen regulation of the housing market and the mortgage industry (Murphy, 2008).

References

Feldstein, M. (2008). How to help people whose home values are underwater. Wall Street Journal (November 18), A21.

Murphy, R. P. (2008). Can the Feds save the housing market? Freeman 58(5), 8.

Sasseen, J., & Francis, T. (2008). A standoff over housing relief. Business Week (December 22), 30.

Wallison, P. J., & Pinto, E. (2008). Let’s use Fannie to clean up the mess it made. Wall Street Journal (October 25), A13.

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U.S. Housing Market: Money Mornings 3-Step Plan Revives Dead Housing

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Baltimore, MD (PRWEB) June 08, 2011

Its been more than 4 years since the 2007 housing collapse, and the U.S. housing market is still a disaster.

Nearly 2 million homes are empty. Foreclosures are rampant. Lenders are trying to shift their surplus onto any stray homebuyers they can find.

And if the U.S. housing market isn’t fixed soon, it’s going to drag the rest of the economy down into a hellish bottom that will take years, if not decades, to crawl out of.

Its a good thing someone is finally stepping up to the plate: Legendary investor Shah Gilani.

You may be familiar with Gilani from his many appearances on Fox Business and CNBC but if youre not hes a rare commodity.

As a retired hedge fund manager who’s willing to share the secrets of what goes on behind Wall Street’s “velvet rope,” Gilani is able to spot the stock market’s hottest profit opportunities.

And since he’s no longer part of the Wall Street power structure, Gilani is also willing to show investors how to capitalize as a top editor for Money Morning, one of the nations leading free investment newsletters.

In this new report, Gilani proposes a 3-step plan to end the crisis in the housing market in the U.S.

He calls this a modest proposal but truth be told its pretty bold. After all, hes making some very tough demands of Wall Street, Fannie, Freddie and the federal government

And they all begin with the thing that matter most – money.

As Gilani says, Without the ability to finance home purchases, we’re only going to sink deeper and deeper into the black hole.

You see, Gilani continues, theres no arguing the fact that bad financing – securitization – got us into this mess. Forget all the arguments about how loan factories spun out no-doc liar loans, or how buyers were equally complicit in perpetrating mass fraud. At the end of the day, the truth that matters is that securitization financed the whole scheme.

While housing market predictions may look dire, Gilani can bring those forecasts back into the black in just three steps.

One thing is for sure: Contrary to the naysayers despite the political pandering in the face of rampant procrastination – hes going to go down trying.

You can learn all of Shah Gilanis bold ideasincluding the three steps to save the U.S. housing market in his latest article: The Dying U.S. Housing Market: Three Easy Steps Revive Housing.

(**) Please feel free to repost this story on your website, including a link to the original article on Money Morning only the investment news you can profit from.

Money Morning.com provides valuable investment research and analysis by top industry and market experts to its more than 650,000 readers everyday – offering unique insights on new market trends and little-known companies and industries, while showing readers the truth behind todays largest business stories.

Respectfully,

William Patalon III

Executive Editor

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