Legal Advice
What is a title?
Title companies generally represent the transaction and act as agents combined for the title insurer, the buyer, the seller and any other party involved in a real estate transaction, such as the mortgage lender. The responsibilities of a company’s titles are many, the most important being:
- Analysis of title to the property to issue a commitment of title insurance. With this step, we perform an investigation of the history of tenure and during this research, you will discover situations that require to be fixed before the purchase. Not having a solution, you decide if you issue the title insurance
- Carry out the closing of the transaction, preparing all the legal documents; to receive the necessary funds from the buyer or banking institution to make the necessary payments, making the function of a trustee. This gives transparency to the transaction.
- Finally, to issue a title insurance to the buyer and the financial institution, ensuring a clean title of any defect holder.
By taking these steps, it offers peace of mind to the buyer that your investment is insured against any possible problem related to the tenure of their property.
How to buy on their own behalf or on behalf of a company?
One of the first decisions you must make when you buy a property in the united states. UU. it is under what figure will buy it. A property can be purchased in the name of a person or a company name. The most frequently used for these cases are: the LLC, INC or Corp. The investment properties, almost without exception, must be acquired through the use of a corporation or other entity.
What are the advantages of buying through a company?
- It protects the owner from any and all claims related to the property. That is to say, in case of demand, they can only go against the property and not against the other property or personal assets.
- It consolidates all the income and expenses attributable to this property within one entity, this will help you to reduce the fiscal impact and during the eventual sale of the property.
- Provides flexibility to the plan for the payment of taxes, in terms of transfer of property interests to family members and other people.
- Avoiding or reducing estate taxes, therefore, the death of the owner of the company is the legal entity that never dies, thereby reducing the amount of state inheritance tax.
Do I need to open a company for each property you buy?
The formation of a company for each property really is the greatest protection you can get. In this way, the investor limits the liability of each of the properties.
If several buildings are under the same entity, the liability of one of them could potentially expose other properties. However, due to the costs of opening, administration, and maintenance of these companies, it is common for investors to maintain multiple properties under a single company.
Estimated costs of opening a company to buy a property
- Cost of opening approximately between $500-$900
- Cost of annual renewal fee ranges between $200-$400 approximately
- Fees from the counter for administration and annual income tax return (before the 1st of May) depend on the service and structure, as requested by each customer, but ranges between $500-$1,000
What is needed to open a company?
- Register name
- mailing Address in the united States
- Names of the managers and their respective ids.
- Prepare articles of incorporation of the company (working counter)
- Prepare operating agreement (working counter)
how Long is the process of opening?
The process takes between 5-15 business days.
I bought a personal name, can I transfer it to a company?
It is important that you plan this before you make the transaction; however, if you have already purchased a personal name, although it is possible to transfer the property, it is important that you advise with an accountant and/or attorney to discuss your specific case and determine the possible legal implications and financial. Among them, it is important to determine:
- If applicable FIRPTA (foreign investors)
- Costs of the transfer
- If it is taken as sale
LEGAL NOTE: These provisions are complicated and require the expertise of a certified public accountant and/or real estate attorney to evaluate the possible legal implications and tax. At no time should you take this information as advice.