[EconProf]

Here is the brutal calculation you have to make:

What is the true, after expenses, value of the property, if sold? Be sure to include all the expenses–they are probably larger than you think.
What will be the 1st & 2d debt owed, as of the date of the last unit sold?
If there is anything left over, that is what is kept.

In my case I could see the builder was going to make less than zero. Therefore he had no incentive to continue. But I could see that if could buy out the bank construction lender, I could sell the remaining units and lessen my loss. It was a nightmare but I did it with the help of a great lawyer. The bankers were turds–they knew I was the bag-holder. But sometimes you must salvage what you can from the situation

[EconProf]

Here is the brutal calculation you have to make:

What is the true, after expenses, value of the property, if sold? Be sure to include all the expenses–they are probably larger than you think.
What will be the 1st & 2d debt owed, as of the date of the last unit sold?
If there is anything left over, that is what is kept.

In my case I could see the builder was going to make less than zero. Therefore he had no incentive to continue. But I could see that if could buy out the bank construction lender, I could sell the remaining units and lessen my loss. It was a nightmare but I did it with the help of a great lawyer. The bankers were turds–they knew I was the bag-holder. But sometimes you must salvage what you can from the situation

[EconProf]

Here is the brutal calculation you have to make:

What is the true, after expenses, value of the property, if sold? Be sure to include all the expenses–they are probably larger than you think.
What will be the 1st & 2d debt owed, as of the date of the last unit sold?
If there is anything left over, that is what is kept.

In my case I could see the builder was going to make less than zero. Therefore he had no incentive to continue. But I could see that if could buy out the bank construction lender, I could sell the remaining units and lessen my loss. It was a nightmare but I did it with the help of a great lawyer. The bankers were turds–they knew I was the bag-holder. But sometimes you must salvage what you can from the situation

[EconProf]

Here is the brutal calculation you have to make:

What is the true, after expenses, value of the property, if sold? Be sure to include all the expenses–they are probably larger than you think.
What will be the 1st & 2d debt owed, as of the date of the last unit sold?
If there is anything left over, that is what is kept.

In my case I could see the builder was going to make less than zero. Therefore he had no incentive to continue. But I could see that if could buy out the bank construction lender, I could sell the remaining units and lessen my loss. It was a nightmare but I did it with the help of a great lawyer. The bankers were turds–they knew I was the bag-holder. But sometimes you must salvage what you can from the situation

[EconProf]

Here is the brutal calculation you have to make:

What is the true, after expenses, value of the property, if sold? Be sure to include all the expenses–they are probably larger than you think.
What will be the 1st & 2d debt owed, as of the date of the last unit sold?
If there is anything left over, that is what is kept.

In my case I could see the builder was going to make less than zero. Therefore he had no incentive to continue. But I could see that if could buy out the bank construction lender, I could sell the remaining units and lessen my loss. It was a nightmare but I did it with the help of a great lawyer. The bankers were turds–they knew I was the bag-holder. But sometimes you must salvage what you can from the situation

[EconProf]

WSJ says 10.3% is the top rate now. But they could be wrong…any input from others?
Funny, I don’t feel very comforted if you are correct.
BTW, our capital gains tax is huge for Californians selling out and moving to another state. I recently sold a long-held commercial property and the state cap gains bite was nearly half as large as the federal.

[EconProf]

WSJ says 10.3% is the top rate now. But they could be wrong…any input from others?
Funny, I don’t feel very comforted if you are correct.
BTW, our capital gains tax is huge for Californians selling out and moving to another state. I recently sold a long-held commercial property and the state cap gains bite was nearly half as large as the federal.

[EconProf]

WSJ says 10.3% is the top rate now. But they could be wrong…any input from others?
Funny, I don’t feel very comforted if you are correct.
BTW, our capital gains tax is huge for Californians selling out and moving to another state. I recently sold a long-held commercial property and the state cap gains bite was nearly half as large as the federal.

[EconProf]

WSJ says 10.3% is the top rate now. But they could be wrong…any input from others?
Funny, I don’t feel very comforted if you are correct.
BTW, our capital gains tax is huge for Californians selling out and moving to another state. I recently sold a long-held commercial property and the state cap gains bite was nearly half as large as the federal.

[EconProf]

WSJ says 10.3% is the top rate now. But they could be wrong…any input from others?
Funny, I don’t feel very comforted if you are correct.
BTW, our capital gains tax is huge for Californians selling out and moving to another state. I recently sold a long-held commercial property and the state cap gains bite was nearly half as large as the federal.

[EconProf]

I was in your position a while back, and unfortunately, lost a great deal of money in the deal. And I saw the bursting bubble coming too. Couldn’t get the builder to keep on the construction schedule, so we missed the top of the market. Had he been on time, we’d have made out fine.
If you have a second TD behind a construction loan, you are really in a bad position. Depending on the numbers, you could lose it all. I salvaged some, but it took a good lawyer, a big infusion of more cash, and a lot of sleepness nights.

[EconProf]

I was in your position a while back, and unfortunately, lost a great deal of money in the deal. And I saw the bursting bubble coming too. Couldn’t get the builder to keep on the construction schedule, so we missed the top of the market. Had he been on time, we’d have made out fine.
If you have a second TD behind a construction loan, you are really in a bad position. Depending on the numbers, you could lose it all. I salvaged some, but it took a good lawyer, a big infusion of more cash, and a lot of sleepness nights.

[EconProf]

I was in your position a while back, and unfortunately, lost a great deal of money in the deal. And I saw the bursting bubble coming too. Couldn’t get the builder to keep on the construction schedule, so we missed the top of the market. Had he been on time, we’d have made out fine.
If you have a second TD behind a construction loan, you are really in a bad position. Depending on the numbers, you could lose it all. I salvaged some, but it took a good lawyer, a big infusion of more cash, and a lot of sleepness nights.

[EconProf]

I was in your position a while back, and unfortunately, lost a great deal of money in the deal. And I saw the bursting bubble coming too. Couldn’t get the builder to keep on the construction schedule, so we missed the top of the market. Had he been on time, we’d have made out fine.
If you have a second TD behind a construction loan, you are really in a bad position. Depending on the numbers, you could lose it all. I salvaged some, but it took a good lawyer, a big infusion of more cash, and a lot of sleepness nights.

[EconProf]

I was in your position a while back, and unfortunately, lost a great deal of money in the deal. And I saw the bursting bubble coming too. Couldn’t get the builder to keep on the construction schedule, so we missed the top of the market. Had he been on time, we’d have made out fine.
If you have a second TD behind a construction loan, you are really in a bad position. Depending on the numbers, you could lose it all. I salvaged some, but it took a good lawyer, a big infusion of more cash, and a lot of sleepness nights.

[Author]

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