Live Probate Training #24: Buying property through business acquisitions, and buying businesses through real estate deals; using asset-based lending to fund buy and holds; and tax strategies for real estate investing.
“…..You hear me talk about subject-to housing. It’s even easier to get a free business.”
Episode #24 of Estate Professionals Mastermind Podcast
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What’s In This Episode:
Chad Corbett and Certified Probate Experts brainstorm tips, strategies, and tools for working less, earning more, and doing good. Federico kicks off the call with a deal he’s working through where the seller keeps delaying close, and his buyer is getting impatient. Next, Chad breaks down the opportunity in small business investments and how you can use business acquisitions to get free real estate and use real estate as a means to find small businesses to buy. Anton, Cristian, and Federico brainstorm how much money it takes to buy a business (hint: it can be free), what the best businesses to invest in right now are, and how to structure ownership agreements when transferring businesses. Chad and James do some deal analysis and transaction engineering for a perfect buy-and-hold opportunity where a landlord isn’t willing to do owner finance. Chad Corbett offers several strategies for accessing funds through commercial, asset-based loans from community banks. Lastly, Corey and Chad discuss whether the tax benefits of a 1031 Exchange are worth it or not in the long run.
THIS WEEK’S CHALLENGE: Probate Mastery’s top performers are challenged to polish up their knowledge of important terms like Loan-to-Value, Debt Coverage Ratio, and UBIT, to shake any anxiety of asking a community bank for asset-based loans for investment properties.
Training Topics In This Episode (YouTube Links):
0:00 Transaction engineering: Subject to replacement property contingency and rent-back after closing
5:13 Save the deal: How to get your buyer paid for residential leaseback at an above-market rent
9:54 Small businesses in probate: How to buy a profitable business in probate/in an estate
12:07 The opportunity in small business acquisition and real estate in probate
15:02 How to buy a business and help the seller pay zero capital gains: Converting business assets into annuities, retirement plans, and avoiding capital gains.
17:29 Buying real estate through small business acquisitions and saving on income taxes
20:18 Great businesses to invest in right now and in 2022, and how to compete with business brokers
25:35 Why do companies offer equity to employees?
31:54 Best books for small business owners in real estate: Who Not How Reviews
33:46 How much money do I need to buy a small business? Can I buy a business without money?
36:22 How to structure transfer of business ownership agreement
42:34 Buy and hold real estate investing: Is a residential or commercial loan better for an investment property?
44:31 Why asset-based lending for rental property beats conventional loans
46:54 Asset-based loans from community banks vs. hard money, private money
47:57 What should I say when applying for a community bank loan for investment property?
48:59 How to pitch owner finance script: Tax advantages to a free-and-clear seller
51:40 Is flipping houses worth it? Most tax-efficient way to flip houses and avoid capital gains tax with creative financing
53:47 Why would you NOT do a 1031 Exchange to save on taxes?
- Join Estate Professionals Mastermind Group (Facebook)
- Chad’s Small Business company: Your Small Business Hub
- Get 20% Codie Sanchez and Ryan Snow’s Unconventional Acquisitions courses:
- ON OUR MAILING LIST OR IN OUR FACEBOOK GROUP)
- Check out Estate Professionals Mastermind and More on YouTube
- Bigger Pockets Forum, for learning more about creative finance.
- Learning Investing Terms:
- What is Debt-Service Coverage Ratio in real estate? Debt-Service Coverage Ratio (DSCR) Definition (investopedia.com)
- What does LTV (Loan-to-Value) mean in real estate investing? Loan-to-Value (LTV) Ratio Definition & Formula (investopedia.com)
- What is unrelated business income tax, or UBIT, in real estate? Unrelated Business Taxable Income (UBTI) (investopedia.com)
- What is Leveraged Buyout for Small Business (LBO) – Leveraged Buyout (LBO) Definition (investopedia.com)
- Recommended Probate, Business, and Real Estate Marketing Books: Probate Mastery Reading List
- Places to find lenders and check lending health:
- Further Reading: How Much Tax Will I Pay If I Flip A House? – New Silver
- More conversation on this in episode 23: Using debt and equity financing to buy Probate Properties + How to make more money in real estate – Probate Mastery
TRAINING SEGMENT TRANSCRIPTS: (Download PDF of Full Transcript)
About the Author
Katt is an expert in probate marketing and helps entrepreneurs build businesses in the probate space. She is the co-founder of the Estate Professionals Mastermind podcast, which has become the most widely-shared probate real estate podcast. She also writes training content for ProbateMastery.com and a weekly LinkedIn newsletter followed by over 5000 professionals. You can reach her on Instagram, Twitter, and LinkedIn.