The 7 Steps to Torpedo Your Estate and Tear Your Family Apart

January 11th, 2021 by admin No comments »

If you currently have a trust, or are thinking of setting one up, this checklist from my book, The 7 Biggest Mistakes Trustees Make and How to Avoid Them, will show you what the most common and serious mistakes are and how to avoid them.

Each one of these seven mistakes has the potential to ruin your financial plans and to turn family members against each other. Here they are in brief:

Mistake #1 – Failure to Communicate: Failing to communicate properly with all the parties involved with the trust is, perhaps, the biggest mistake trustees make. From my experience, parents must deal with three important predicaments before considering advanced planning:
1.Do we have enough money to last the rest of our lives?
2.Do I want my spouse to know all the financial details of the estate?
3.Do we want our children to know all the financial details of the estate?

I have also found that once planning takes place, children must also deal with two common reservations:
1.I don’t feel I should interfere with my parents’ finances.
2.If I take an interest, will I be perceived as being greedy?

Through my experience, families that avoid mistake #1 have a foundation that is able to withstand almost any type of problem in the future.

Mistake #2 – Failure to Hire the Appropriate Advisors: Estate planning is a growing sector that is becoming more complex with its constant changes. Every year laws are revised and added. It’s important that when it comes to making important financial decisions that you consult professional advice from a team made up of: attorneys, accountants, and financial planners.

Mistake #3 – Failure to Follow the UPIA: This mistake is more legal in nature than the previous two. It involves the UPIA, or, more specifically, the lack of knowledge of it. UPIA stands for Uniform Prudent Investor Act. Do not ignore this new law! Ignoring this law increases your chances of being sued. It provides an easy way for a disgruntled heir and a slick lawyer to prove that a trustee is unfit to manage the trust, and owes significant amounts of their personal money back to the trust.

Mistake #4 – Failure to Follow the Terms of the Trust: The most important part of estate planning is the trust. The trust is something that should not be taken lightly. It must be well thought out and written to express your exact desires. There can be no ambiguity in a trust. There can also be no assumption that your heirs will know what your intentions are. You must be as specific as possible when writing this document.

Mistake #5 – Failure to Minimize Liability and Risk: The trustee has many duties and responsibilities to the beneficiaries. The trustee is the protector of the assets. He is responsible for not only maintaining the current level of investments, but also ensuring that the investment will grow at a reasonable rate of return over the years. When planning for future finances that involve minimizing liability and risk, there are three areas to be considered: long-term sickness, taxes, and general lack of knowledge.

Mistake #6 – Failure to Review Regularly: A common mistake among trustees is the failure to review the trust regularly. Your life changes over time. So it is necessary to keep on top of these changes. The review process is divided into three critical areas: investment strategy, trust assets, and advisors.

Mistake #7 – Failure to Treat it like a Business: As a trustee, you need to think of yourself as a manager. You have a finite number of assets to manage, and your long-term goal is to make them grow. This is your business. Separate yourself from the beneficiaries, even if you are one. Think of them as shareholders, and it is your job to maximize profits without taking on too much risk.

You are accountable to the beneficiaries for your actions. It is your job to protect yourself and do the best job possible. You are taking on a great liability, so you need to make sure you get good advice. There are many decisions that need to be made over the life of the trust, many which are not pleasant to make. Some even have absolutely nothing to do with assets or money. Yet, they must be faced. The more aware you are of the potential problems, the better trustee you will become.

How ADHD Almost Tore My Family Apart

December 15th, 2020 by admin No comments »

ADHD is not an easy illness to deal with as a family. And yes it does involve the whole family whether you like it or not. When one family member as ADHD it’s every body’s job to help, at least this is what we found. In order to understand this illness we had to look at the definition and this is what we found.

ADHD is a condition in which a person has trouble paying attention and focusing on tasks, tends to act without thinking, and has trouble sitting still. It may begin in early childhood and can continue into adulthood. Without treatment, ADHD can cause problems at home, school, work, and with relationships. In the past, ADHD was called attention deficit disorder (ADD).

My stepson was diagnosed very young because both of his parents have this illness and since the only evidence that researcher have found is inheritance in the main source of getting ADHD, it was inevitable that he also would have it.

I knew nothing about this ADHD stuff so through some research that I did and talking with professionals about the topic, I’ve come to learn a great deal about the medication and treatments that were necessary in order for my stepson to live a nice and healthy life. His father is against medication (for personal reasons) which I and his mother also agree with the reason of dependency issues but something needed to be done.

My understanding of this medication is that it only should be use to suppress the symptoms so you can implement other techniques and methods (medication is not the permanent answer), but it can be a helper. We as a family had to all get involved with the help of his teacher and doctors to implement all the necessary action, such as Behavioral therapy, Interactive metronome training, and neurofeedback treatment; also in the meantime developing a well structured schedule and diet, including such thing like omega-3 fish oils and a zinc supplement.

Not a day that goes by that we don’t thank all the people who have helped us deal and live with this illness in our family. It’s not an easy task to deal with ADHD with children, but it can be done with the proper information on natural remedies and methods. Most of our help came from [] Thank you for our new life.

Don’t Let Poor Estate Planning Tear Your Family Apart

December 8th, 2020 by admin No comments »

Even if your kids are grown up with families of their own, you can probably remember scenes of intense sibling rivalry when they were younger. In some families, that competition continues into adulthood; for others, it recedes as children age and mature. But it can all come flooding back while trying to divide up your estate after your death as your kids argue over who gets what.

If you die without a will, a court will decide, based on state law, who will inherit your property. In most cases, the result might be contrary to your wishes. Think of all the assets you’ve accumulated: house, car, jewelry, investments, family heirlooms and more. “It is simply not enough to say ‘let them just divide it evenly or work it out themselves,’” says Gerald A. Youngs, president of the National Association of Estate Planners & Councils (NAEPC). This is sure to create problems and expenses due to probate laws, state laws and court appointed strangers making family decisions.

“While many people worry about the federal estate tax, the truth is most of us won’t have a tax problem under the current tax laws,” says Youngs. “But the ‘family tax’ is a very real concern,” he adds. The family tax is the price paid by children, grand-children and favorite charities when you do not express your wishes legally. The family tax is paid not only with money, but also with hard feelings.

But it doesn’t have to be this way. You can make it easy on you and your family by taking a few simple steps to make sure your estate is in order. Whatever the size of your estate, the first step is to have your intentions put in writing, either in a basic will or a will plus the trust documents that will be needed to carry out your wishes. An estate planning professional can help you make the best decision for your situation.

Once you have a plan in place, discuss it with your family. If anyone has any questions about the details, or any quibbles, you can address them and put to rest any future squabbles. While your family shouldn’t dictate your actions, they should be informed about them.

This is also a good time to discuss dividing up personal property. People often arrange for the executor of their will to divide personal property their spouse doesn’t want (such as furniture and jewelry) among their children. Simply leaving it at that can cause problems. It is better to put together a list with a description of the property and who you’d like to have it – if you have specific requests or wishes. You can put this list together with input from your children to alleviate any hard feelings later. (See footnote at end of this article).

Putting together an estate plan is not as daunting as it might seem at first, and it pays big dividends in the long run. Not having an estate plan in place can cost you not only in dollars and cents, but also in family discord.

Family Law – Don’t Let Disputes Tear Your Family Apart

November 23rd, 2020 by admin No comments »

When you are faced with disputes and disagreements within your family and have trouble reaching solutions or keeping things amicable, it may be time for you to hire an attorney that specializes in family law. Even though everyone may have the best of intentions when they are trying to resolve disputes, everyone knows that things can get a bit testy no matter what the situation is. Family law attorneys have a wide area of expertise. They handle everything from divorces, legal separations, child support, alimony, custody disputes, adoptions, paternity issues, division of assets in divorces and more.

Depending on your particular situation, you may feel that you can get things resolved in a fast manner without having to go to court. Since family issues often results in both sides letting their emotions get the best of them, it is imperative to keep the lines of communication from breaking down and hire a family law attorney. You want to avoid letting things get out of hand and to keep things professional and any agreements completely legal, you can always request an arbitration with a family law attorney.

By utilizing the services of a family law firm, you can help to get personal matters resolved in your favor. Sometimes if you don’t know what your rights are, you can end up being taken advantage of or having things ruled against you. If you want to give yourself a fighting chance, you need to make sure you have the right legal counsel that money can buy.

When you need assistance or simply legal advice, you can always go to a law firm that handles domestic affairs. You can get expert advice and receive guidance about what needs to occur for things to be resolved in your favor. Who knows, you may need help coming up with a good strategy or arrangement. It is always a good idea to hire legal representation when things need to be determined and they involve assets, children and legal issues.

Make sure that when you select an attorney, they have a good reputation. They should also have a lot of expertise and knowledge about laws regarding domestic and family situations. Since the laws regarding these areas can be quite extensive and complex, instead of trying to figure out what you need to do, a lawyer can help guide you.

Don’t be ashamed or afraid to ask for help when things start to get a bit out of control. Sometimes it is necessary for you to seek legal counsel because the other party is being unrealistic and overly demanding. To prevent yourself from being treated unfairly, you should make sure that you don’t enter into any agreements or attempt to do any litigation without proper counsel.

Do yourself a favor and stop making a stressful situation even worse by keeping matters professional and letting your lawyers handle everything. This way no personal feelings will get involved and cause any complications.

Commercial Mortgages – Bank Requirements For Multi-Family (Apartment Building) Loans

November 5th, 2020 by admin No comments »

Many commercial real estate investors contact our firm and want to know in-advance if their deal can qualify for an institutionally funded (bank) commercial mortgage loan. Unlike residential lenders, commercial mortgage lenders do not issue “pre-approvals”; we simply can’t tell if a deal will get done until we do some underwriting. We can, however, share with you some basic guidelines that virtually all conventional lenders are considering today.

Loan-to-Value (LTV)

LTV has been dramatically reduced during this “credit squeeze”. Just 24 months ago we were seeing LTV ratios above 80% and lenders were allowing large 2nd mortgages. Standards have tightened. In today’s credit environment, investors should not expect to see any loan offers above 75% and many are coming in significantly lower. 70% is a normal LTV ratio on new purchases with some lenders willing to go to 75% on refinance loans. Seller carried 2nd mortgages are discouraged and often disallowed altogether. Borrowers and sponsors without large cash investments in a deal will be turned away.

Debt Service Coverage Ratio (DSCR)

Banks, insurance companies and Wall Street brokers simply will not write loans against underperforming or vacant buildings anymore. Only stabilized assets need apply for institutional funding now-a-days. A building must be able to demonstrate a history of profitability and low vacancy. To be approved for a bank loan for the purchase or refinance an apartment building, the building must have a net-operating-income (NOI) equal to 125% of the proposed mortgage payment (a DSCR of 1.25). Deals that do not meet this requirement will have to wait until the credit markets improve or seek private funding.


Borrowers or sponsors with weak credit scores are being summarily rejected by banks. To qualify for a low interest loan with good terms, from an institutional lender, all the principle borrowers need to have a tri-merged credit score of 640 or better. I know this is bad news to many good people with problems on their credit reports, but that’s just the way it is right now.


Banks are not willing to take a chance on first-time apartment investors. All borrowers are now required to demonstrate real experience in rental housing and a track record of success.

Net-Worth & Liquidity

Many banks have instituted a policy of requiring that their borrowers have a net-worth at least equal to the balance of the loan they are seeking. In-other-words, if you want to borrow $1MM from the bank to buy an apartment complex, you need a net-worth of at least $1MM. Further, they will want to see that you have some money in the bank above and beyond the funds you’re using for a down-payment. Often they will require borrowers to have a savings account balance equal to 6-9 monthly mortgage payments.

Quality Property in Good Location

To secure financing from a traditional lender the building must be in a city or town that is not particularly depressed economically. Hard hit areas of MI, FL, CA or NV, for instance will be shunned. Also, the structure must be in good repair, lenders will shy away from buildings that have a-lot of deferred maintenance.

Deals that meet these basic requirements will find that there is no lack of liquidity even in this tight credit market; there is plenty of money for apartment loans for the borrowers and buildings that can qualify. Unfortunately, for deals that can not meet these higher lending standards, investors are going to have to seek privately funded, often called hard money loans or take on a well-heeled partner in-order to get funding.

Closing Costs When Buying a Multi-Family Apartment Building

October 22nd, 2020 by admin No comments »

When buying a multi-family building as an investment property, closing costs can add up to a large amount, and thus should be calculated with careful attention since the investor needs to estimate if he has enough funds for the down payment and the closing costs prior to closing the deal.

It is also important to estimate how much cash is needed to put aside for the closing costs prior to closing since one of the bank’s conditions when approving a mortgage is making sure the buyer has enough funds for the down payment and closing costs together.

Appraisal Fee: This requirement is helping the bank to assess the market value of the property, so that it can estimate the LTV (loan-to-value). If the appraised value is $500,000 and the LTV is 80%, then the bank is willing to loan $400,000 out of the total assessed value. Appraisal fee is usually a must with insured mortgages, but for conventional mortgage, it can sometimes be waived at the discretion of the bank that provides the mortgage. Appraisal fee depends on the size of the multi-family buildings and other considerations. The appraisal directly correlates to the size of the building: the larger the building, the higher the appraisal’s fee.

Phase 1 Environmental Fee: Environmental analysis of the property and all surrounding uses or conditions to make sure the property and its surrounding aren’t contaminated from any past use of chemical, oil tanks and other hazards. Usually this fee is associated only with insured mortgages only and not with conventional ones.

Inspection Fee: Inspection fee includes careful inspection of each unit in the building to make sure there is no structural problem with any of the units and the building overall. Inspection should be done only by a professional, since missed issues by him can later on cost you a lot of money to repair. The more units to inspect, the higher the fee that is charged by the inspector.

Land Transfer Tax (LTT): This fee depends on the province the multi-family building is purchased in. Specifically, if the property was purchased in Toronto, the land transfer tax needs to include Ontario LTT and Toronto LTT.

Legal Fees & Title Search & Disbursements: Each transfer should be reviewed legally by a lawyer. A lawyer is in charge of completing the transfer of the deed, preparing the mortgage, and conducting various searches such as, title search.

Land Survey Fee or Title Insurance Fee: A recent survey of the property is usually a requirement of the lender. If non is available, then title insurance can replace it.

Mortgage Application and Processing Fees: This overall fee depends if the mortgage is insured or not. If the mortgage is insured, then the investor needs to pay both the insurance company (CMHC or GE) and the lender itself. CMHC charges processing fee and mortgage insurance premium depending on the amount being loaned and the amortization period. On top of that, each lender charges application fees as well. The lender’s application fee depends on the institution the money is being lent from.

Reserve Fund: Reserve fund should be added to the closing costs to make sure that in the first couple of years (before any cashflow has been accumulated) there is enough money to be spent in case “big item ticket/s” need/s to be fixed/replaced, such as leaked roof, furnace stopped working, etc.

It is very important that you search around for different professionals before deciding on which one to go with. Your considerations when choosing should include price, reputation, and efficiency.

In conclusion, the total amount spent on closing costs can start from 2.5% of the purchase price and go up to much higher amount depending on various factors, such as the amount put into the reserve fund, the province you choose to buy your investment property in, etc

Practical Guide in Multi-Family Apartment Investment

October 15th, 2020 by admin No comments »

When you have reached the level of competency and confidence to handle multi-family property investment, it is best that you seriously consider this strategic investment shift. Seasoned real estate investors usually graduate to this type of investment option to improve their cash flow and earnings. This goes beyond the opportunity of receiving higher rental earnings as a result of a greater number of units for rent. The earning opportunity is associated to economies of scale. This means that with higher number of rental units in one location, there will be more opportunities to cut cost through several means.

• Savings in Repair and Maintenance

The unit cost for repair and maintenance can be significantly reduced in multi-family property investment whether you are contracting the volume work from a service provider or hiring your own in-house service personnel. If you will consider the savings that you generate over a period of time, the amount will definitely be very significant.

• Upgrades and Purchases

Whether it is brand new painting units or refrigerators, you can leverage for better deals and discounts from suppliers and dealers when you negotiate for volume purchases. The potential number of units to be purchased is one great equalizer for property investors to clinch good deals and substantial cutbacks on the purchase price. With this significant leverage, you achieve a certain degree of clout when dealing with dealers and suppliers of furnishings, appliances and other items that you will need in the operation and maintenance of your property.

• Property Insurance

Building apartment units is less expensive than building single detached homes. Thus, it is logical that the property insurance will also be lower for the former. In addition to this built-in advantage of apartment units, there is also that leverage of owners of multi-family property investment when negotiating for insurance. With apartments, you will only have one single policy to cover all the units of your apartment property. The significant reduction on the price of the property insurance is due to the distribution of the overhead cost to a greater number of units compared to individual single detached units where each will have to bear the brunt of the full amount of the overhead cost.

Financing Options for Apartment Property Investments

Capital requirement for a property investment of this scale is one of the major challenges. Property investors must really need to have deep pockets if they intend to enter into this kind of venture. Property construction is not easy and it requires substantial amount of capital. In most cases, not many people have this amount of money available to start such a big project. However, with proper planning and careful management of available finances, one can avail of financing to support multi-family property investment. Those who don’t have sufficient amount of capital can opt for multi-family property refinance loans.

You can check out potential financing programs for your property investment online. You can easily get a quote for a particular loan amount in addition to the details and terms of the financing programs on offer in these websites. This makes it easier for property investors to shop around and weigh their options without having to physically coordinate and consult with all these banks and mortgage companies. It also simplifies the process as you already have all the information that you need at your fingertips, and you can confidently make your decision and come up with your short list of choices or options.

Investing in multi-family apartment is not a piece of cake. It requires years of experience, training and sufficient amount of cash. However, with proper planning and support, you can enjoy better earning capacity and maximize the returns of your investment in real estate properties.

Real Estate Investing In Multi-Family Apartments

September 25th, 2020 by admin No comments »

Some investors find investing in multi-family apartments rewarding as they yield more long-term returns. An average individual investor cannot invest in multi-family apartments by himself; they make use of specialized REIT’S to do it for them or form a partnership with an experienced associate as it takes up time and needs an experienced person to see to the due-diligence, to take control and manage the property wisely.

Tips on How to Invest In Multi-Family Apartments:

It is necessary to identify a stable, profitable multi-family apartment, have a good idea of the local market and the have the ability to estimate the land value as well as the building value properly.

It is essential to make a financial as well as marketing analysis of the property.

Present a well thought out irresistible offer to the seller once you have made sure the necessary finances are in order.

Proceed with the due diligence and not be satisfied until you have studied in detail every document relating to the building and the maintenance of its equipments etc. The title deeds, tax returns of last 3 years if possible, insurance policies, financial records, information of any existing liens, all leases and all contracts for equipment maintenance, parking lot contracts, all utility bills, fire systems, litigation history, tenant and associated problem records etc. will be appraised. Engineering inspection, environmental inspection etc. will be conducted on site.

Have an attorney study all the documents and explain them to you.

Once the due diligence matters have been cleared it is time to bargain for as low a price as possible and legally purchase the property if it suits your needs and seems a profitable venture.

Try, and get a triple net multi-family apartment, as it could be a hassle-free investment as the owner just has to receive monthly rental checks and does not have to worry about maintenance etc. as the tenants are in charge of that!

People like investing in multi-family apartments because of increased cash flow, competition is less, if indeed you are in charge of maintenance because of the big cash flow it will be easier to hire a manger to take care of the property and deal with its problems. Multi-family apartments are also in demand because the property appreciates better than a single-family property. Some creative real state investors make fortunes rehabbing run down condos and giving them a face-lift! Thus, multi-family apartments are ideal suited for those who have large sums of money on hand to buy and invest in high yielding properties. They should have the expertise to deal with tenants and collecting rents on time and know what action to take incase the tenant defaults on payments.

How to Find Perfect Family Apartments For Sale in Milton Keynes

August 11th, 2020 by admin No comments »

Milton Keynes, one of the biggest towns of United Kingdom, is situated near North West London. Since, this town is comparatively new, it is quite well planned, and organised. You can find the best facilities to live here. A source says that almost 7-9 families shift to Milton Keynes every day, which is a good example of how popular this place is. Finding a perfect apartment in Milton Keynes is not a very tough job. You will find a lot of apartments that matches your criteria.

Milton Keynes is a very famous residential area. You can find luxury apartments on reasonable prices. The town is conceptualised in a great manner, and since the town is very close to cities like London, people find it convenient to work in big cities while residing in one the best towns.

It is not very difficult to find perfect family apartments. You can simply contact a property agent, and he/she can guide you accordingly. You should have a proper knowledge of the town, so that you can decide, which area you would prefer for living, or which area suits your living style.

The best thing about Milton Keynes is that you can find all the luxuries of life. There are big shopping malls, hospitals, schools, good transport system, parks, and everything that is required for a nice and comfortable living. The apartments are well maintained and well designed. The old apartments are renovated to keep them in a proper shape.

If you are looking for a perfect apartment, you have to be very clear about a few things. Looking for an apartment with random thoughts will make things difficult for you. You should be aware of what kind of apartment you need, how many bedrooms, and what kind of facilities. In addition, you have to decide if you would like to have an apartment in the hustle bustle of the town, or a little far away. The flowing river and huge green lands is very soothing to the eyes, and the environment looks extremely nice

The homes that are located far away from the busy town are cheaper as compared to the homes located near the town. You can choose whatever is suitable for you. The apartments are very well maintained, so if you decide to go for a cheaper apartment that does not mean that the apartment will be of bad quality. You will find every luxury there as well, but first, you need to finalise the location.

Once you have finalised all your details, you can inform the property agent about your requirement. He/she will help you to find the most suitable apartment for you. It has some really nice and expensive areas such as Caldecott, and other good residential areas such as Willen.

The price range of houses may differ because of the locality, and size of the homes. You can find big luxurious homes as well if you can afford to buy one. Milton Keynes is undoubtedly a nice place to live with your family, and finding a perfect apartment is not that difficult.

Multi-Family Apartment Loans

March 13th, 2020 by admin No comments »

There are a number of different multifamily apartment financing programs available. They are generally divided into small apartment loans for properties costing between $1 million and $5 million, mid-balance loans for transactions between $5million and $25 million, and large financing programs lending for transactions with no specified upper limit, and a bottom limit of $2 million.

Small multifamily apartment financing

The Fannie Mae loan program offers financing for multifamily apartments with more than 5 rental units. The loan amounts are between $750 thousand and $3 million dollars and have terms of between 5 and 30 years. Another option in this category is a multifamily FHA loan, which is administered by HUD. These government loans are attractive because they do not depend on the volatility of the market. The source of financing remains in place because it is government allocated and controlled. Small conduit multifamily apartment mortgages are also available from 1$ million to $5 million and terms of 5 to 20 years.

Mid-balance and large multifamily apartment financing:

The same basic categories apply to mid-balance multifamily apartment financing as noted above. There are the Fannie Mae programs, FHA loans, and small conduit loans for these monetary ranges. There may be other types of loans available in addition to these so ask your loan broker about the programs they recommend.

How to get approved for multi-family apartment financing:

Specific programs have their own criterion for borrower approval. These lenders base their decision both on certain criteria that the borrower must meet and stipulations for the multifamily apartment being purchased. An example will serve to illustrate this.

Let’s say you are trying to take out a small multifamily apartment loan under the Fannie Mae program. They require that your FICO credit score be higher than 680, and that you have a minimum of 2 years’ experience with 2 multifamily properties. They also require that the post closing liquidity (that is, the amount of cash you will have after purchase of the apartment building) is equal to or greater than the loan amount.

As concerns the property itself, it must be able to demonstrate an average 90% occupancy in the 12 months prior to receiving the loan and it must have 5 or more rentable apartments. The properties are also restricted in most cases to 25 year amortization schedules.

Multi-family apartments are a good real estate investment in these troubled times. The demand for multifamily housing remains fairly steady and the existence of multiple players (i.e. the borrower, tenants, lenders, and possibly government sources) in the cash flow patterns of the transaction distinguish it from other lending and borrowing markets. So if you are thinking of getting into real estate investment, this is a potential area to consider.

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