00:02
Robert Chadwick
Robert, it says you’ve started sharing your screen, but we’re not able to see the slides. Okay.

00:19
Donald Klip
Can you say this one?

00:20
Robert Chadwick
Yeah. Two minutes to go, guys. Eight attendees.

00:24
Speaker 3
Wow.

00:25
Donald Klip
It. Hey, Donald, just so we’re clear, I’ll just say thanks for joining us or whatever, and then you can talk. And then just kind of start talking about the slides, and we can.

01:31
Speaker 3
Yeah, and then I’ll ease, I’ll transition to you.

01:35
Donald Klip
Okay.

01:36
Speaker 3
But I’m introducing everybody initially. Right? Right at the beginning.

01:43
Donald Klip
Okay, sure. You can do that.

01:46
Robert Chadwick
I’ll let you know when to go. So, make sure to turn on your camera. I’ll just drop a message on a WhatsApp group chat. So then just turn on your camera.

01:55
Donald Klip
And turn on your camera. I’ll stop sharing, we’ll talk a little bit, and then I’ll turn the slides back on.

02:02
Robert Chadwick
Okay, I’m going to broadcast at six sharp.

02:07
Donald Klip
But we’re not going to start though.

02:08
Robert Chadwick
Broadcasting. Yeah.

02:12
Donald Klip
All right, go on, mute.

03:24
Speaker 3
It. It.

04:31
Donald Klip
Hi, everybody. Thank you for joining us. For another one of our webinars. This is quite a unique webinar. We have not had a founder’s chat for a long time. So, I’m happy to have my co-founder of global Mortgage Group and American Mortgages, Donald Clipp on with me to discuss not only the recent rate drop, but some really amazing enhancements for our business, which certainly adds or certainly adds value to you as clients and to our loan officer team and so forth. So, Donald, thanks for joining. It’s been a while. I’m glad you’re able to make the time for this.

05:22
Speaker 3
Come on. I’m super excited. We haven’t done one of these in a while. I’m really excited to engage our audience and our community, and I really appreciate everybody tuning in. 06:00 p.m. Asia. Time to listen to this presentation. There’s a lot of information you read in the news. Interest rates have been coming down. There’s a lot of reasons on why that is, but the bottom line is they have come down. So, to the extent that you are looking to potentially buy real estate or invest in us real estate, you want to get an update on the key factor in that decision, which is the cost of funding. So, looking forward to kind of discussing that as we speak. So, let’s get started.

06:09
Donald Klip
Yeah, so how this webinar will go is we will talk about the recent, big updates that we have for America mortgages, and then we will discuss the recent rate drop and why and sort of our outlook on what’s going to happen with the US real estate market. And then we’ll do our normal going over the loan programs, and then we’ll have a question-and-answer session. So, during the process, if you do have any questions, please put them into the chat and we will answer it towards the end. One thing as well, if you want to use our new platform, which we will discuss shortly, you can apply for a loan directly through the chat, or you can arrange a time to speak with one of our loan officers.

07:06
Donald Klip
Our loan officers are based all around the world, and it is literally a 24/7 schedule. So, with that, Donald, let’s start. I shall, yeah, let’s do it. Can you say that? Okay.

07:24
Speaker 3
Yep.

07:25
Donald Klip
All right. Okay. So, US mortgage loans for international clients, that’s what we do with America mortgages and global mortgage group, as everybody is probably aware, our big updates. So, for, so for the loans in general, we have seen a decrease of at least 1% across the board. So, Donald, I know were talking about this earlier today in the office. Now, if you look at where were pricing foreign nationals, for example, just two weeks ago, they were around eight and a half percent. And I think today we price something out in the very high six s, which is absolutely amazing. Okay. One of the other updates we have is that we used to have, when we first started, a minimum loan amount of 150,000, I’m sure you remember, and that has been a consistent request for our clients.

08:51
Donald Klip
So we’ve recently been able to reduce our minimum loan amount to $75,000, which is huge for a lot of our investors that own a lot of smaller properties. So now, with up to 75% financing and a reduced loan amount of $75,000, Donald, I think we’ve really made it so that almost anybody can be a real estate investor. I don’t know if you have anything you want to add on that.

09:27
Speaker 3
No, the lower loan amount has really opened up opportunities in some states where the cost of the homes is much cheaper. And that makes it very attractive for a real estate investor. If you’re investing your disposable income, obviously, you could buy some stocks, you could buy some crypto. But if you wanted to buy a home, for example, in Manhattan or Los Angeles, it’s hard to come up with a million dollars for a 50% loan-to-value on a $2 million home. However, there’s a lot of growth opportunities in the Midwest, for example, in Ohio and Michigan, and those loan amounts are smaller. So, this lower loan amount allows an entry point for a bigger and wider audience who want to take part in this amazing investment opportunity, which is us residential real estate.

10:22
Donald Klip
Excellent. Well stated. So, I’m sure a lot of people are aware of our interest only program. I think this is one of the key features that we have as a company that is super attractive when it comes to investing in us real estate. And just to cover it a little bit, our interest only program is a fixed rate for ten years. Now, that ten-year fixed loan, you’re only servicing the interest for that ten-year period. After the ten years, that loan will not reset. It’ll stay at that same rate. But now you’re paying principal and interest, so you’re looking at a total 40-year tenure. And I think what makes it super attractive, especially as rates come down, you’re really going to be able to take advantage of the yield of a property.

11:21
Donald Klip
And you assume after the ten-year period, when that rate converts into a principal and interest, 30 year fixed, your rental rates are going to be significantly higher. Wouldn’t you agree, Donald?

11:35
Speaker 3
Yes. The purpose of real estate investing, or investing in general, is to maximize your cash flow. And so, if you can have ten years where you’re not paying principal and just paying the interest, it means for those ten years, you are maximizing your cash flow opportunity, that is rental income for those ten years. Now, obviously, in ten years, the property price is going to go up and it allows you more financing options down the road. But if you’re strictly looking at earning as much rental income as you can over a period of time, this is the best option.

12:11
Donald Klip
And I think one thing that also makes it very unique, too specific to the US, is there’s no age restrictions. So, whether you’re 19 or 99 in the US, they feel you should all have the same opportunity when it comes to housing, which is considered also for the mortgages. So, no age restrictions, as in most countries, you know, it’s going to be either limited to a specific age or to a working age. So, it really makes it fantastic. All right, the next big update. And this is something, again, much like the reduced loan amount we’ve been getting requests on a regular basis. And that is if you buy a property, you renovate it and you improve the value significantly. We used to have to wait six to twelve months before we would use the new appraised value.

13:09
Donald Klip
We’re really excited to announce that we reduce this to only three months. So, I think, Donald, you have a very good example of this for clients out of Singapore, so maybe you can give a little explanation on that.

13:25
Speaker 3
Yeah, I think for those of you out there, these sophisticated investors, which is our audience listening right now, you will likely have stumbled across an investing technique called the BrRr method, which is buy, renovate. Let me get this right. It’s bought, renovate, refinance, rent out, and repeat. And what that means is you buy a home that’s undervalued. Let’s just, for example, in the neighborhood, it’s 250,000. You see a home that’s worth 150,000, you go to Home Depot, you engage a contractor, you spend ten, $20,000, and once you’re done, it actually is worth $300,000. Now, historically or previously, up until now, you would have to wait six months before you’re allowed to refinance. But now, as soon as it’s done, we engage in appraiser, and that comes out at 300. You can refinance 70%, 75%, even 80% as an expat of the new value.

14:24
Speaker 3
So you pull out the equity of the increased value, and that can be done ASAP. So, the time in which you can execute these type of strategies has now been reduced to zero previously six months, and anything can happen in six months, and that ties up your capital for six months as well, as opposed to using it to make more money.

14:47
Donald Klip
We still have a minimum time that needs to be waited, which is three months, But we’ve reduced the time by half. So, it’s absolutely fantastic. Everybody is probably already aware that we have common sense underwriting when we do our loans. I mean, you know, specifically what that means is instead of asking you for your tax returns and your pay stubs and your end of year statement, or w two, or whatever it may be called, we are only qualifying the rental properties off of the rental income. I mean, if you think about it just makes sense. Sense. This is something we’ve been doing for a while, but not everyone is aware of it. So, we talked about this the other day on our group loan officer call, Donald, and I think you brought something up about what’s needed to qualify for this.

15:49
Donald Klip
Is it a one to one or what specifically are we looking at?

15:54
Speaker 3
Yeah, you know, I think, you know, the audience, once they contact us to learn more, they’re going to be really surprised and impressed on how easy that we’ve made this foreign nationals looking to buy property for investment income. So, the way this works is, you know, we, you know, like any purchase or refinance, we will have to, you know, you will have to. There will be an appraisal that will be conducted along with a rental comparison. And what that means is if the rental comparison comes in at, let’s just, for example, say, 2000, and your mortgage and mortgage related expenses comes out at 2000 or 1999, you qualify. It’s not based on, like Robert said earlier, your pay stubs, your human resources need to write you a reference letter. All these things that typical bank loans require; we don’t need them.

16:55
Speaker 3
And it makes it easier for our clients, which are all outside the US, because sometimes there’s different, there’s time zone issues, there’s language issues. And so, we’ve made these. We specifically created these to make it easy for our international clients to qualify when they buy property in the US.

17:15
Donald Klip
Yeah, it’s actually a fantastic loan program because besides the reduced loan amount of $75,000 and not having to have us credit, being able to qualify just strictly on the rental income really makes it to where almost anybody can be a real estate investor. Build your portfolio, and for the future have passive income. The biggest update that we have, and something that Donald and I and our entire team has been working tirelessly for more than a year, is the launch of Morty AM. Morty AM is our mortgage application platform. Now, what this does is it allows you to get a pre-approval and often less than 24 hours. This is an online application, but it is also available within two weeks on the Apple and the. What’s the other one?

18:24
Speaker 3
Android.

18:28
Donald Klip
It’ll be easily downloaded, and you will have access to this anytime you want to buy a loan. You get a pre-approval, you get it into the system. You’re talking to a realtor, maybe they’re somewhere in some country and you can zap them that pre approval letter. So, it’s a really slick program. The application itself, it’s really simplified. I don’t know if, Donald, you want touch on anything about, especially how we really worked. Very difficult to, I mean, in a very diligent way, to make this application applicable to our foreign clients.

19:08
Speaker 3
Yeah, everything we do for our clients. We created this to fix a problem. We’re a small company trying to fix a big problem, which is trying to get access to us mortgages while living overseas. So, we hear our clients, we hear the feedback. And what we’ve heard is that the world is ready for a digital solution. The world is ready to, you know, for certain aspects of a mortgage. They’re ready not to speak to somebody, obviously, you know, the initial call and the follow ups and, you know, the urgent questions, you know, we’re here for you, but a lot of the manual, things such as, you know, you know, uploading financial statements, things that, you know, that can be on autopilot through this software, just makes the clients lives a lot easier.

20:03
Speaker 3
And you could do it at your own time, as opposed to sometimes you get an email from a loan officer and forget, and you go to work and you kind of miss a day here and there. Here it’s all online. It’s, you know, you, you know, it obviously sends you reminders, but it allows you to. It allows the process to be a lot faster than normally it would be when you’re dealing with a financial institution back in the US.

20:32
Donald Klip
Yeah, I mean, I think with this launch of this program, we’ve made our services even more valuable than most of the big banks. So, it’s really fantastic. And if anybody wants to download the application or actually right now, it’s more of a link to the web portion of it. You can scan the QR code that is on this page here. So, we will go to the next page. Okay. More big updates. As everybody is aware, because all of our clients are living and working abroad, we understand that they don’t always have the ability to search for services or providers which you may have ready access to if you were living in the US. So, we’ve made it very simple.

21:33
Donald Klip
We have on our website in the middle section, our concierge section, and on that you can do everything from setting up an LLC for your company to own the property, to streamline your insurance with prime insurance coverage, to even getting the best rates on FX exchange when you need to move your money per se, of a down payment, to being able to provide proper and adequate property management solutions through a company similar to us that only focus on foreign nationals. So, another big update, and again, this comes from a lot of requests for our clients. We get clients all the time that get pre-approved for a loan. But once they get pre-approved for a loan, they don’t know where to find a property, or they’re not really sure where to find a property.

22:34
Donald Klip
So Donald has actually been the driver on the real estate portal. So, Donald, why don’t you tell us what we’re looking at and what our clients should be expecting?

22:47
Speaker 3
Yeah, so I don’t want to spill. I don’t want to, what do you call it? Unveil sort of the surprise. But I need to plug a report that we will be publishing very soon, which is, this ties into what you just said, which is we analyze the price per square foot for every major city in the US and every major global city. And we also analyze the rental yield in every major global city and the top 100 cities in the US based on population. And the reason why I say that is because once on your real estate journey, everybody has different criteria on where they’re looking for. Is it close to my relative? Am I going for pure, the highest return? Or it needs to be near an international airport or needs to. We all have different criteria, but finding the properties is difficult.

23:36
Speaker 3
So that report is going to help you narrow down your search. It’s never been done before. We’re the first ones in the world that will be able to do this. So, keep your eyes out for that. And that leads into this portion, which is when our clients use us to get a pre-approval. First of all, you need a pre-approval to buy a property because sellers won’t sell you the property unless they feel comfortable that you have financing behind you. But being able to offer carefully selected and curated property that meets the needs, price point and logistics of our international clients is very valuable. And one thing, I’m going to talk about this in the upcoming slides, but there is a six to 7 million home shortage in the US. That’s why it makes.

24:30
Speaker 3
I don’t want to pre-empt sort of my portion of the presentation, but getting property to be sold is like gold dust. So, we’ve been trying for a long time and so we’ve been able to secure homes just outside of Dallas, Texas, which is a really amazing location for gentrification. A lot of people working from home. But anyhow, I want you to contact us. We’ll give you the details for that. The website is the link is up for the properties that we have available to sell. These are new properties. They come with property management. They’re amazing. They fit the price point for our international clients. So, we will, when we send you a thank you letter, we’ll add the link to that email. So, keep an eye out for that along with the research piece that will be coming out very soon.

25:18
Donald Klip
Yeah, I’m very excited about it. I know. Again, it’s just like all of the things that we work to improve or to fix this has been a huge contention for a lot of our clients. So, with that said, we will, Donald will discuss, is this the best time to invest in us real estate? And really, here is why.

25:42
Speaker 3
Thank you, Robert. That was a fantastic presentation. I’m going to talk about really quickly the current supply demand landscape of the US. I know you read a lot of things, maybe in the media, India, a lot of it is true, but a lot of it is not understood why. Now, interest rates have gone up a lot, but if you can believe it, home prices in the US went up 8% last year. I mean, that’s unbelievable. Interest rates went up 400% and property prices still went up. Now, I’m going to address this in kind of a systematic format, which is supply and demand. So currently, over the last ten years, there have been 5.5 million households formed versus homes built. That means there’s five to 6 million more homes, households that have been created versus homes that have been built.

26:35
Speaker 3
And like it says, so there’s a massive shortage, which you’ll read everywhere when you’re doing your research. Now, those are new homes. Now, existing homes, which is about 90% of, you know, kind of the transacted homes, 80% of the folks that have mortgages, 80% of those mortgages are fixed for 30 years under 5% and 40% are fixed for 30 years under 3%. Sorry, that’s a typo. Under 3%. So, what that means is that it’s kind of put this supply grip on the market. And so, if you think about it, what happens if new homes are being built? And this is also why it’s been really difficult for us to get new homes to bring, to show our overseas clients, is that as soon as homes are built, guess who’s buying them?

27:31
Speaker 3
The average person may not be able to buy them at 8% fixed for 30 or 7% fixed for 30, but institutions can, right? And this is their playbook. They try to buy as much supply as they can because they know the supply demand is imbalanced. They control pricing. And this is no secret. You can google institutional buying of single-family homes in the US and you will see what’s going on. Like any smart investor, it’s a lot better if you invest alongside smart people. And we think the folks like Blackstone and American homes and these type of landlords that you see are fairly smart. So that’s happening now. Next slide. Now what’s happening with demand? Now, what happened with COVID was that people worked from home, they went from.

28:22
Speaker 3
It was always kind of growing at 2.5% a year, so it was heading in that direction. But during COVID overnight it went to 100%. And I think a lot of companies realized that there actually is a portion of. Of work that can be done at home. And I think that’s allowed people who lived in different states to move to find work opportunities in other areas easier. Now, the US, it’s a lot of things, but in terms of its ability to gentrify is without a doubt the best place in the world. If you can’t afford to live in California, which many can’t right now, you can rent a U Haul and move your family to Texas, which a lot of people are now, and make a living.

29:07
Speaker 3
And you look at what’s happening in the US right now is a lot of the coastal states, specifically California and New York, a lot of these big companies are created there. Facebook, Amazon, you name it, Tesla. And they become so big that folks can’t afford to live there. So, companies move their headquarters to Texas to low or no tax states. And that’s happening end masse. And that’s driving the demand to rent homes. And you’re seeing that now. In fact, Dallas is the headquarters for the most fortune global Fortune 500 companies in the world. And coincidentally, I don’t want to plug our property again, but the new homes that we’re offering at the moment is 40 minutes away from Dallas. So really want to show you those homes when we get a chance. Next slide. So, this is really eye opening.

30:05
Speaker 3
So if you look at the G seven countries, I mean, this is just a select a number, the rental yield, and this is cash flow received from rents, it’s really low. In fact, I would argue that you cannot make money of renting homes anywhere in the world except Dubai and the US. Now, if you look at the average rental yield in the US, it’s 8% at the moment. Now, if you take out California, New York, that actually turns out to be twelve to 15% gross yield. It’s really hard to believe, but it’s true. And there’s just lack of information in the world about this phenomenon. So, if you are sitting in these countries where you’re making a good living, a good income, and for example, in Singapore or Hong Kong, where I’m from, getting in the real estate market is really expensive.

31:01
Speaker 3
It’s minimum, two, three, four, $5 million. Whereas in the US, you could play this game with 100, $150,000 and enjoy 15% rental yields. Now, there’s obviously a lot of things that you need to learn, but like anything in life, you’ve put in the hard work, you reap the rewards. This is just a snapshot. In fact, I would argue that this is a little outdated. The numbers are even slightly higher at the moment. But you can see this is not to say that you should rush out and buy a home in Detroit or Milwaukee or Omaha, where actually Warren Buffett is from, but you look at places like Ann Arbor, a huge college town. University of Michigan is there. You look at Las Vegas. It’s the center of all convention business in the US at the moment.

31:50
Speaker 3
Atlanta, the home of the busiest airport in the world. Each one of these cities represents a different thematic. And look at the gross yields. This is one of the biggest surprise slides that when people see that, they go, oh, my God, why didn’t I not know about this? But now you do. And now with leverage, you can take advantage of this. So that’s my bit on the market. I will hand it over to Robert to go into our loan programs and then towards the end, open it up for Q and A. And I look forward to that.

32:24
Donald Klip
Thanks, Donald. I think too, going back to just say the yield slide that you are showing, if you look at what the general yield is in the US, say 5% or less, that is taking into account the coastal states such as California and New York. But if you were to take those out of the picture, these are actually what people could potentially be looking at. And as you said, and because we do loans, not just in the US, but all around the world, we really understand this probably better than any other country or company that are offering mortgages. Okay, so let me give a general overview of the mortgages that America mortgages offer. Now, again, 100% of our clients are living and working abroad, but obtaining us mortgages, whether for purchase, refinance or cash out.

33:28
Donald Klip
I think as we’re seeing interest rates go down, we will see people just refinancing, not pulling cash out, but merely just to reduce the rate. So, if you’re a foreign national, you are able to get up to 75% loan to value in all 50 states. If you are a us expat, we try to make it exactly as if you walked into a bank in the US and you were living and working there. And for an investment property, you can get up to 80%. Something very unique to us mortgages. Again, there are no age restrictions. So, I always like to say, whether you’re 19 or 99, you still have the same mortgage amortization regardless of the age of the borrower. We discussed what ten-year interest only loans are absolutely fantastic.

34:24
Donald Klip
If somebody wants to maximize yield and lock in a rate to where they don’t ever have to worry about refinancing again, unless they choose to. We qualify on the rental income of the property for investment properties. It makes it a very simple, clean, easy way. We don’t care if you are self-employed or you are employed all we care about is the cash flow of the property, which again, is common sense underwriting and just makes sense foreign income. If you are, say, a US expat or you want to qualify using your income, we absolutely allow it, because again, this is all we do, all we deal with. It’s very common and very normal for us. Again, these are loan programs for non us residents, whether you are a non us passport holder or you are a us passport holder living overseas.

35:30
Donald Klip
What also makes these programs very nice and why we have a lot of business which is referred to from private banks, is all of this is dry lending. And if you’re familiar with lending in Europe, most lending requires the borrower to open up some sort of account with the bank that they’ve got a mortgage with a minimum deposit. We have no requirement for that. This is pure dry lending, meaning there is no requirement to open up a bank account with that lender. A loan process in general, once we get your application, we’re looking at 72 hours for issuing a pre-approval. With the launch of Morty, we can actually reduce that to 24 hours, if not sooner.

36:25
Donald Klip
Our average closing time is 30 to 45 days, and you can sign your closing documents in your home country without ever having to leave to travel to the US. So basically, you can start the application online through Morty, and you can close even at your local notary, depending on the country that you’re in. What makes us also very unique, and a lot of it has to do with qualifying off of the rental income of the property is 97% of the applications that get submitted are approved. It’s a number that we’re super proud of. And it’s something that if for some reason the loan isn’t approved, it’s normally property related and not really related to the borrower. Again, and this is in the chat link for everybody to work with.

37:22
Donald Klip
We have 24 hours a day, seven days a week loan officers all around the world. You speak, or you’re more comfortable speaking another language. There’s a variety of options, which, when you’re choosing a calendar time, you can click if you would prefer to speak Spanish or Chinese or whatever it may be. So, I’ll just go over a couple of the loan programs quickly and then we’ll get to the questions and answers. So, our most popular loan program is the America mortgages rental coverage plus loan. And this is something that Donald and I had talked about earlier in the webinar and what I had just gone over. This is the loan program that everybody loves. It requires you to submit no personal income. So, whether you, again, if you’re self-employed or you’re employed, you don’t show maybe your true serviceability of income.

38:19
Donald Klip
This allows anybody to still be a real estate investor. If you’re a foreign national, you can get up to 75% financing and a US expat, assuming you still have us credit, you can get up to 80%. No us credit or residency is required. It’s a very fast, simple loan program and the loan amounts are as low as $75,000 and can go as high as 3 million. Again, we offer on these programs 30-year fixes, interest only. If you look at how this loan qualifies, it’s on the bottom of this slide and it’s a very simple process. If the rental income covers the mortgage, taxes and insurance, the loan is going to qualify. So, it’s very straightforward. In the event, say that the rental amount does not qualify, it does not mean that the loan is not approved.

39:18
Donald Klip
It just merely means that maybe you have to bring in a little bit more money to be able to get that number to work. Next program is our expat program. If you are a US expat and you’re living abroad and you have gone to your local bank or one of the big banks that are well known, you will find out that you’re going to get halfway through the process before they realize that you’re earning your income in euros or in yen or whatever it may be, and they’re going to say, I’m sorry, we cannot do your loan. Well, again, because 100% of our clients fit this box. We’ve made sure that all of the loan programs that we have are specific for our clients living globally.

40:11
Donald Klip
If you’re a US expat, we allow foreign income, we allow your bank account to be in a foreign country, and there’s no requirement to provide a w two. That is huge. The only real, I guess, caveat on this is you still need to maintain us credit with at least a 646 80 credit score to qualify for this. The minimum loan amount is $150,000 and we can go all the way up to 5 million. This works just as it worked when you were living and working in the US, where it goes on your debt-to-income ratio. We have a debt-to-income ratio of 43%.

40:55
Donald Klip
So in this example, as long as you’re making $10,000 a month, and that is your gross income, not your after-tax income, and the mortgage payment, taxes and insurance are at least 4300 and below and including any other debt that you may have in the US, your loan is going to qualify. So again, we try to make this with the same rate, the same terms and the same programs as if you were living and working in the US. Absolutely fantastic program. So that’s it for our webinar for today. This is our contact information for our office in the US, as well as our office in Asia, where Donald and I are both based.

41:42
Donald Klip
You can click on, or you can scan the QR code, which is on the right hand side, that will link you directly to a WhatsApp messenger where you can reach out to one of our loan officers, ask a question about a loan, or even get the direct link for Morti to apply for a loan. Again, we have a link within the chat that allows you to schedule an appointment with a loan officer 24/7 or if you want to, you can go online and apply directly through mortgage. So, let’s get to the questions, Donald, and let’s see where we are at. So, what I’ll do is I’ll ask the questions and then we can both kind of enter and see where we go. So, first question is, what is the likelihood of being approved? Donald, do you want to take that?

42:41
Speaker 3
Yeah, I mean, the short answer is highly likely, you know, depending on what loan program you’re seeking. But as with regards to specifically the loan program that we mentioned earlier, which is based on the rental income of the property, you know, when you’re doing your research, you have a pretty good idea of what the rents are, right? You speak to you, you look on Zillow or Redfin, you speak to your realtor. So, you can do the math. And you just need a few documents to get a pre-approval with us. Robert, you want to talk about what kind of documents are actually, this answers the next question as well. What kind of documents you need to get a, a pre-approval.

43:25
Donald Klip
Yeah. Fantastic. So, to get a pre-approval for the loans, it is about as straightforward as you can get. Assuming you’re a foreign national, you’re just going to need your passport. And this is, again, on our portal, you can securely upload everything. So, there’s no security issue or trust issue on this go through, you can complete the loan application. And really the biggest concern or the biggest hurdle that most people have is the down payment for the property. So, we need to see for AML purposes that any money that is going to be used in the transaction has been in your account.

44:07
Donald Klip
It can be in the US, it can be overseas for a minimum of 60 days if you’re fine with that hurdle, then once you submit all the documents, your loan officer will review it along with the application, and we can issue a preapproval in 24 hours. Next question.

44:27
Speaker 3
Rates have come down, but will they stay down? Well, that’s a crystal ball question, but I think I could take a stab at this. Rates. I think we can all assume that rates will be cut. And these are fed fund rates now, will they stay down? I can’t see them going up. I think inflation print just came out overnight and they look like inflation is coming down. So, there’s more room to move the rates down, but who knows? But I would have to say over the course of the next few years, I can’t see rates going up, either staying flat or coming down, which is really good for being a property investor.

45:14
Donald Klip
Absolutely. So, okay, next question. What would cause a loan application to be rejected? Well, I think there’s a couple possibilities, is if you’re a us expat and say, maybe you don’t have sufficient credit, that could be a reason. Or maybe your debt to income doesn’t work. But we do have loan programs that will help you with that as well. For us in general, normally it’s not about does the loan qualify or not? We qualify 97% of our loans. It’s really, does the rental income cover the mortgage payment? And again, with that, it doesn’t really mean that the loan doesn’t qualify. It maybe just means that you have to come in with a bit more cash. Okay, next question. What is the most popular loan program in American mortgages? Funny, because that is exactly how I introduced that loan program.

46:12
Donald Klip
That is our rental coverage plus. And again, if we go back to the question about what causes an application to get rejected, this is the most straightforward, most common-sense underwriting loan program that you have where you’re qualifying off of the rental income and not the personal income of the borrower. Next question. Hey, great presentation. Which banks do you work with for underwriting and disbursement? Let me jump on that, Donald, and then maybe you can add something. But last December, we actually became a direct lender ourselves. So, we are able to lend in our own name, which makes it fantastic because we have a lot more control over the loan programs. Now, when it comes to loans that maybe don’t qualify for our own lending, then we have a variety of options.

47:07
Donald Klip
These are banks that likely you have never heard of, but banks that we’ve curated over the years that understand our clients being foreign nationals and expats.

47:20
Speaker 3
Yeah, maybe I’ll add a little bit of. A little bit here. So, it’s, you know, we’re preconditioned to think, well, most of us are not you and I, but most people in the world are preconditioned to think mortgage. They think banks. However, in the US, most and the biggest mortgage lenders are not traditional retail banks. I’ll give you an example that everybody knows. Rocket mortgage. Rocket mortgage is the largest mortgage lender in the US. But they’re not a bank. They don’t take deposits. And these are called wholesale lenders. So, these are the type of lending institutions that we work with. And we are one ourselves, as we are a lender ourselves as of December last year, which is great. So, this makes, you know, American mortgages is the only us mortgage broker outside the US. We created this process. We are the global leader.

48:20
Speaker 3
And just like, I guess, many restaurants like to use farm to table, we want to move higher up the food chain. So, we’ve become a lender so we can give you the type of service, pricing, transparency and accessibility that our clients need, deserve and want. So that’s a little bit of background on kind of our journey to becoming our own lender.

48:41
Donald Klip
Perfect. And Raul, to answer your question again, we don’t use a normal bank, even for us citizens. We’re going to use a bank that understands you as a borrower. So, it’s what we do is unique, and it really works when it comes to earning foreign earned income. As an expat, which I’m assuming you.

49:05
Speaker 3
Are, I’m going to give a quick anecdote to our audience, and I think folks in Hong Kong can empathize with this. We had a client recently call us and said that their loan got rejected because they could not put a zip code into the little box that says, what’s your zip code? Because Hong Kong doesn’t have any zip codes. And just because of that, they couldn’t move forward with their loan. Now, this is just a microcosm and a small sample of the issues that we’re trying to fix. And, like, we know the cultural and country idiosyncrasies of folks living outside the US. And this is just a funny example, but it’s true. And it happens all the time, but not with us, because all we do.

49:53
Donald Klip
Yeah, absolutely. I would probably say 20% of our business is expats that were going through a major bank in the middle of a purchase to have their loan officers say, oh, I didn’t realize that you are earning foreign income. So. Okay, next question. Can a loan commitment be less than 30 years, if you choose. Absolutely. If you want to have a 15-year term, that’s your option. In general, our loans are 30-year fixes just because people want that safety and that security. But if you want to pay your loan off or make double payments or even have a reduced 15-year term, that’s absolutely fine. Again, we just, if you’re qualifying off of the rental income, you know, when you shorten the amortization, that could be an issue, but is absolutely perfectly acceptable. Next question.

50:45
Donald Klip
How do we make sure that the rental price, I’m assuming this means, is accurate. And that’s a super good question. And I think we receive this every day when we order the appraisal or the valuation, depending on the, depending on where you’re living, we order a supplement to go along with that. That supplement tells us exactly what the average rent is for that specific property, and that’s the number that we use to qualify. So, it not only protects the lender, but it also protects yourself to making sure that this is the type of rent that, you know, you’ve been told by the realtor you’re going to get. Next question. Do your loans have unit count Max or minimum? I’m not exactly sure what that means. Donald, do you have an idea?

51:38
Speaker 3
Yeah, so I think it’s the number of doors per loan. I think you’re going to be more of an expert on this, Robert. But I think the per loan, the number, I think it’s a four-unit max for four door max on some of our loan programs. I really should get more involved in the loans, but I apologize. I believe that’s what this.

52:06
Donald Klip
Okay, so, yeah, if that’s what it means. So, a one to four unit, we can qualify technically as a single family. So, you have the same LQB options that’s available. So, thanks for the explanation, Donald. Next question. You mentioned that you qualify most of your borrowers, and usually the properties fall down to a 3% rejected application. Could you give us an example of the type of properties that you will not finance? Again, very good question. If you look at, say, exactly in New York has a lot of co-ops, very difficult to finance. We won’t do rural properties. So, properties that are quite far away from the city center, and we really will stay away from mobile homes or manufactured homes. Otherwise, it’s an open market.

53:04
Donald Klip
You find a property that you love, you want to be able to finance, you know it’s going to get fantastic rent a, give one of our loan officers a call and run it by them. They’ll tell you immediately if it’s going to be possible. Yeah.

53:15
Speaker 3
And one thing, you know, one thing that, you know, part of that 3% that were not approved, a lot of that has to do with the property that you may have missed when you. When you. When you. When you view the property. You know, for example, in San Francisco, there’s, you know, part of the appraisal is looking at asbestos, which is in between walls, which there’s no way you would be able to see that. So, in different cities, they’ll look at different things, you know, the structure wise or what’s in the walls or maybe holes that you didn’t see, and they don’t pass the appraisal process. So, a lot of times it has to do with the specific property, not actually you as a borrower. So that’s really important to say.

53:57
Donald Klip
Yeah, absolutely. Okay, next question. Some investor loans that fall into the better financing deals have a four-unit max. So, this is actually a really good question. In general, our very vanilla loan, especially the loans that we offer ourselves, are one to four units. So that is, we can do that every day. However, we also have loan programs that are for five to eight units. So, if you see something that, you know, it’s a fantastic loan, we can still qualify our fantastic property. Sorry. We can still be able to provide that loan for that up to 75% loan to value up to an eight-unit property. Next question. Can I close my existing loan midway through the tenor and reset my rate? So, in general, an investment loan will have a prepayment penalty.

54:56
Donald Klip
So that prepayment penalty normally will be a decreasing amount, that every year will get less, but it is still there for investment properties. However, it does not mean that you cannot. If interest rates go down and you’re able to do a simple calculation of what the breakeven is, it doesn’t mean that you will not be able to refinance your property at any time. If you wait until the prepayment penalty is finished, certainly you can refinance it without any penalties into either a shorter loan or you wanna pay it off, or even a brand-new loan and pull cash out. Next question. In the last question of the night, what is the minimum down payment required to qualify for a loan? So, in general, it’s 25% if you are a foreign national with no us credit.

55:54
Donald Klip
If you are a us expat, then it is 20% with that. Thank you, everybody, for staying through this hour. I think when Donald and I were talking about doing this, were saying we’ll probably knock it out in 15 to 30 minutes. But as you can see, with a lot of involvement and all of these fantastic things that we’re able to offer, this ran a bit longer. So, Donald, do you have any parting words that.

56:23
Speaker 3
Yeah, listen, all I want to say is, I say this to clients, is, if you can make the numbers work now, they’re only going to get better because the cost part of your equation is going to go down, interest rates and the income part of your equation is going to go up, which is your rental income. And then after, because the property is increasing in value over time, which has been proven that at some point you can refinance at a higher rate and recoup some of your initial capital expenditure. That’s what makes us real estate, the game of us real estate investing, unlike any other place in the world.

57:04
Donald Klip
Refinance at a lower rate.

57:05
Speaker 3
Lower rate. Sorry.

57:08
Donald Klip
So, again, I think just to kind of, like, add to that, if you’re waiting for interest rates to hit the lowest p or the lowest point possible, you’re going to miss out on what right now is still a buyer’s market. So, we always recommend, get in there now, rates are still absolutely fantastic, especially if you lock it in long term, you do an interest only. So, thank you again, everybody. Thank you, Donald. And we will see you, I believe, in a couple weeks for the next webinar. Appreciate everybody’s time. Don’t forget, in the chat box, there is a link to either doing the application on Morty or to schedule a time and day to speak with a loan officer. So, thank you, everybody. Appreciate your time.

57:52
Speaker 3
Thank you, everybody. Have a good evening.

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Disclaimer: This transcript is AI-generated, so kindly pardon any transcription or grammatical errors that may be present.

01:46
Kyle Mazzuchin
Hello everybody. Thank you very much for joining us. We’re just waiting for a few more people to come on the line, and then we’ll start in a few seconds. Hello everybody. My name is Kyle Mazuchin, vice president for the domestic markets here for American mortgages. Hopefully, you’re doing well this wonderful Thursday evening and Friday, wherever you are around the world—joining us. Today, we’re here to talk about some Canadian tax overhaul and strategic moves for our investments. So, here is just a little bit of content for today. We’re here to review a little bit from the last webinar we did in February and a little bit about myself, the presenter, being here with American Mortgages since August 2023. It’s been a wonderful ride thus far. And then why the US versus Canada?

03:46
Kyle Mazzuchin
There are lots of domestic trends that have really turned the tide in terms of Canadians investing in American real estate. Also, some underlying statistics as to immigration trends are included in that piece. So, we want to make sure that there are some pieces of data that support why there are going to be strategic investments from Canadians investing in the US. And then probably one of the biggest pieces of the 2024 tax here in Canada has been the Canadian tax changes. The Canadian gains inclusion has gone up. Which state is good for me, and what should I do with your capital? So why American mortgages? 100% of our clients are working abroad. So, we want to make sure that there is relative ease in having American-based access from anywhere around the world, including Canada.

04:54
Kyle Mazzuchin
Naturally, being close to the border, we only focus on foreign nationals and us expats. We have representation in twelve different countries. Make sure that whatever language that you speak, we have that availability for you. Speaking of languages, we have several different kinds of languages, and we also understand cultural nuances. And then also we have all loans don’t have a requirement for us credit, which is fantastic. Also, we can have closing documents signed without traveling to the US. Common sense underwriting, which is probably one of our main focuses here at American Mortgage, makes sure that the process is very easy and simple to understand. There’s no age limit or restrictions on getting any sort of US-based investments and then interest-only servicing facilities.

05:47
Kyle Mazzuchin
So, in order to keep your rental yield high longer, the sanitization schedule that we can have is 40 years, then loans in all 50 states. So, you have 50 different options in whatever state you want to invest in. We have transparent fees and processing and then also 24/7 access to myself or any of my colleagues around the world. So if you want to have a 04:00 a.m. or if you want to speak mortgage to somebody, go to our website, www.americanmortgage.com. A little bit about myself. Been in financial services for approximately, probably just a little bit over ten years, in different capacities, specializing in mortgage origination, providing solutions for all different types of customers and investors, whether it’s in Canada or the United States.

06:36
Kyle Mazzuchin
My previous leadership experience was as a senior leader at the Bank of Montreal, managing a team of 25 based on beautiful Vancouver Island with my family, two children, and a wonderful spouse. So why invest in Canada versus the United States? So larger, bigger, better, a more diversified economy, global influence, and innovation. Obviously, when we’re talking about any sort of R and D, we really look to the United States for being a leader in that area. Lower taxes and also favorable tax treaty, stronger currency. Obviously, a lot of different countries hold it as a reserve currency, and it has the reserve currency status in many different countries around the world. Probably one of the most interesting topics here in Canada in the year 2024 was the capital gains inclusion tax change. So now it’s in the 2024 federal budget.

07:36
Kyle Mazzuchin
There have been lots of changes to the proposed capital gains inclusion rate for individuals, trusts, and corporations. So, as of June 20 25th, 2024, not that long ago, anyone making about $250,000 and above on a sale of an asset has their inclusion tax change from 50% to 66.7%. There are obviously a couple of delays, but it will still definitely impact some investors looking to make a profit on any sort of asset or real estate in this case. So, just some examples. So if we look at someone making $75,000 and they profit from the sale of a cottage, for example, 100 grand, after paying real estate fees and clothing costs, 50% of that profit is going to be taxable, about 50 grand added to your income. So, if we look at this extrapolation. So you’re looking at about 125 grand in that case.

08:37
Kyle Mazzuchin
So, pertaining to this situation and understanding these implications can empower you to make informed financial decisions and effectively plan for your future. So, based on the budget that has passed, all corporations and trusts will increase the 66.67% up to 50%. So, it is quite a substantial increase for anyone making $250,000 or more. So, for individuals making over 250,000, the inclusion rate would be that percentage. And for individuals under 250,000, the inclusion rate will remain at 50%. So, how do we plan the future as Canadians? So, realizing the existing capital gains before June 25 is critical. Then, complete pending transactions before the deadline. Review capital assets held in trusts or corporations, and then stay the course with long-term unrealized assets, analyze the time and value of money for tax payment decisions and review your residency requirements to optimize your tax situation.

09:50
Kyle Mazzuchin
So, how do we compare to our brothers down south? So, Us citizens, for example, or green card holders in Canada, can face a total tax rate of approximately 39% of capital gains. So, Canadian, us, federal, or us net investment tax. So leaving Canada can become, you know, a bit of a challenge. So, becoming a non-resident in a non-income tax state could definitely provide you with better results. So, for example, as you can see here, taxes are only 24%, but when you leave Canada, it imposes a departure tax on individuals, ceasing residency of some sort and subjecting them to a certain capital gain amount. Another piece of information we can use is net investment income tax. So, us citizens and green card holders in Canada are subject to us tax.

10:41
Kyle Mazzuchin
The federal tax on capital gains and capital assets held for one year or longer has a maximum tax rate of 20%. Capital gains taxes can be claimed as a foreign tax credit to reduce or eliminate your federal income tax. So, in summary, capital gains tax impacts cross-border investment decisions. And it’s best to get the proper tax advice from a cross-border accountant so that you can optimize your Canadian and our tax situation. So, here is some data pertaining to immigration from Canada to the US. So, the federal government ultimately wants to increase the number of permanent residents. So, in the last probably two years, we’ve had a lot of immigration. So, in this case, there will be about half a million permanent residents by 2025.

11:42
Kyle Mazzuchin
Lots of different reasons why lots of mass retirements are built, and there is a job shortage in certain occupations that are really looking at the government of Canada, in this case, the liberal party, in order to bring in twice as many as they have done since 2015. So that’s going to be impacting a lot of new house builds in Canada. So essentially, an estimated three and a half million houses and units beyond what we project need to be built as usual. So essentially, that’s going to leave a big hole in terms of bringing half a million people and doubling our immigration in 2015. It really impacted the affordability of housing in Canada. So, with that comes a bit of reach from our tax system. In order to stop speculation in the Canadian housing market, a series of taxation pieces came aboard.

12:38
Kyle Mazzuchin
For example, the capital gains piece, the underused housing tax, and a myriad of different provincial regulations have come aboard, especially with Airbnb in provinces such as Quebec, Ontario, and British Columbia. So you can see immigration back to the trend after the pandemic, for example. So, as you can see here, between 2018 and 2023, the number of people for every quarter has essentially left Canada with upwards of half a million people per year coming in. So we’re seeing a lot of that level out, especially with affordability being difficult, especially in the real estate sector, and not keeping up with mass immigration, in addition to individuals leaving Canada for whatever reason. So, just some trends. So, in the first six months of 2023, 42,000 people have left Canada. This adds to about 93,318.

13:43
Kyle Mazzuchin
Sorry, 93,818 people have left between 2022 and exits in 2021. The immigration rate hit a two-decade high in 2019. So this really gives you an example of some statistics. This is not a new trend. It’s really been here since probably the year 2017, where we’ve seen a net loss of a lot of citizens leaving and then trying to recoup a lot of that through immigration, through the permanent residency program, since probably after the pandemic has ended. So now to some probably better news. You want to look at different jurisdictions in order to make a purchase. So, a couple of different places that Canadians are looking at is Florida. As you can see, there’s a big Quebecois community in Florida as well as everywhere around the world. Florida is very desirable for its diverse housing options.

14:43
Kyle Mazzuchin
Arizona is quite dry and mild, especially for those Alberta-based individuals who are looking at Sedona Monument Valley to lower their costs in the state of Arizona. California is definitely one of those, as well. It’s a diverse lifestyle with access to the ocean, mountains, and forests. California probably has the 8th largest economy in the world. So there’s a very diversified economy, probably just as big as other countries combined. Probably one thing that we’ve never thought of is really Louisiana, so it’s for its southern culture. French influence. So again, another French Canada influence. The lower cost of living and favorable property tax system has left its appeal with Canadians looking to Louisiana as an option. Montana is close to British Columbia and Alberta. So, there are lots of nature enthusiasts who enjoy abundant outdoor activities, such as skiing, fishing, and hunting. So, it is definitely an outdoor escape for a lot of individuals.

15:48
Kyle Mazzuchin
South Carolina has lots of good golfing beaches as well. Near, near Georgia, so wonderful in terms of its rich history and showcasing museums and plantations. So, where do Canadians go? So, as you can see, it’s California, Florida, New York, or Texas. Critical in terms of identifying which spot you want to be in such specific counties in these certain states. Los Angeles County is very natural. Orange County, Maricopa County in Arizona. King County is in Washington, especially near British Columbia and then Broward County. So, combined, these five counties are home to approximately 13% of all immigrants currently living in the United States. So which cities are most popular for tourists? So if you’re just looking for vacation means, Orlando, Las Vegas is a wonderful place to go for a weekend getaway. You’re looking for a nice winter getaway from Toronto in the minus ten degrees Celsius.

16:58
Kyle Mazzuchin
Miami, Los Angeles, San Fran, and are you looking for a New Year’s getaway? Definitely New York. Now, one of our biggest passions is our mortgage overview here at American Mortgage. So, here is just a little bit of a review of our programs. No us credit is required, and there is no need for assets under administration. Foreign income is allowed through an income letter loan program in all 50 states, up to 75% loan to value foreign national booking for purchases, and then if you are living in Canada and want to purchase back in the US, So 80% LTV or loan to value for ex pets loan approvals are in 72 hours. Contact us. We’ll have a letter ready for you. If you’re looking for a pre-approval or conditional approval based on a refinance application, we can definitely close in 30 to 45 days.

18:00
Kyle Mazzuchin
Probably one of the biggest pieces. Can you sign closing documents in major countries? So we’ll get into that a little bit later in terms of what that process will look like. So we can definitely look at purchasing properties, refinance, and if you’re looking for an equity release, 30-year amortization regardless of age, ten-year interest only to keep your rental yields high. Loan programs without income are available, and 97% of all of our loan applications that are submitted are approved. So, some of our programs are just a highlight there. So, the AM rental coverage program, which is closed for 30 to 45 days, as we alluded to, does not require US credit or residency. So, we qualify only on the property’s projected rental income.

18:54
Kyle Mazzuchin
So again, if we look at the example below, $2,400 $2,400 in expenses, you qualify for the AM student program, so student tenants are not required to have income, but we can definitely get you approved to help your child’s credit and available between $150 to $3 million AM investors. So, we can use 30 to 45 days for income, but tax returns are not required. So, we qualify using an income letter from an employer or accountant. Loan amounts from $150 to $3 million are available, and again, a 30-year fixed interest-only program is available and up to 75% financing foreign nationals. So, if we look at a debt-to-income ratio, 43% of that.

19:52
Kyle Mazzuchin
So if we look at a gross income of ten grand, and if we look at your mortgage payment, taxes, and insurance at $4,300, we definitely can look at that ratio of 43%, which is fantastic, so if you’re a us citizen living in Canada and wanting to purchase in the States. Again, the same DTI, or debt-to-income ratio at 43%, requires two years of tax returns, and a 680 FICO score is definitely required. And we qualify the same as if you are living and working in the US. Loan amounts differ a little bit between three to 5 million. So, our high net worth program. So, no personal income is needed, and no assets under administration are required. So essentially, that financial institution doesn’t need the $5 million portfolio in order to exist on their balance sheet.

20:48
Kyle Mazzuchin
So you can just confirm it; we’ll just need to confirm a two-month average liquidity of your portfolio in order to qualify. So, the methodology below. So, if we look at 5 million divided by the 60-month fixed term, you’ll be able to have that mortgage payment at 80,000 and the income generated at $83,333. So, a little bit of our contact information is here. As you can see, our headquarters are in the US and Singapore, and our global mortgage group’s office is there. So, everybody, thank you very much for taking part in our presentation. So we’ll just go to a question and answer period. So, it looks like we have a couple of questions that have popped up. So, can I register a property in a Canadian company or an American LLC?

21:54
Kyle Mazzuchin
So, you want to make sure that you’re looking at registering an American LLC. You can go to our website @americanmortgages.com, and on the concierge tab, you’ll be able to get directions to register a limited liability company. So essentially, that removes any sort of liability you held personally. So, if you register a company name onto a property in the United States, you’ll be able to remove any sort of personal liability. Also, please go to a tax accountant in order to make sure that you receive net benefits within your home country in terms of taxation. So, I have a second question: What’s the best way to get my application started? So, at the end of this presentation, we could definitely look at sending out some details in order to start your application.

22:56
Kyle Mazzuchin
So we do have a wonderful new dashboard that we’ve launched in the last six weeks where you can start your application from the comfort of your own home rather than sending emails so you can log in to apply dot americanmortgages.com Kyle Mazuchin Register you’ll be able to make your application and send your documents directly to our online portal and have immediate updates. So how easy, another question here. So, how easy is it to transfer cash into us dollars? So we’ve teamed up with our concierge tab; you can definitely go to one of our partnerships, and vendors will be able to transfer cash with relative ease and transfer it from Canadian to American dollars. So, we’ll definitely have some information on our website and our concierge tab.

23:50
Kyle Mazzuchin
So, I think we might have answered this other question here in terms of how to register an LLC. So you can register through our website [email protected]. Use the concierge tab to look at getting your LLC started. It’s very inexpensive. In order to do that under dollar 150 US, you’ll be able to do that. So, can I complete my us purchase without leaving Canada? Great question. Very common. So if you have a, if you have the ability to go to your local notary and if they have something called an apostille stamp, essentially it’s a service where a lawyer is able to witness other documents from other countries, and it’s legal there.

24:50
Kyle Mazzuchin
So you can have your lawyer or not be able to use that stamp from Canada, and then you send the documents back over courier, and you’ll be able to get your mortgage funded without the need to go to the US. Another way is to go to the local US embassy to make an appointment. One drawback is that it could take a couple of months for you to get an appointment. So you may want to look at both options. Okay, so I’m a Canadian looking to buy a vacation home in the United States. And what are the rates? So your rates will be different from having an established credit score in the United States or not so normal for your down payment. You’ll be looking for at least a 25% down payment based on our income letter program.

25:48
Kyle Mazzuchin
Interest rates will probably range between the high sevens to about mid-eights, just dependent on state and location. So, can I get an insurance quote through American Mortgages? Yes, you can. Mauri alluded to that. So please go to our [email protected] on our concierge tab in order to get an insurance quote through our website. So, another question. I’m purchasing a foreclosed property. Can I get financing? So, great question. So, most of the time, there needs to be a bit of a cash-purchasing situation.

26:33
Kyle Mazzuchin
So you’ll need to go through a bit of an auction process, so they may allow it, but in order to have a more competitive situation, I would recommend that you have cash in place, purchase it, and then maybe do a refinance at a later date, because you may want to look at the condition of the property, get your inspections done, and then have an improved property. And if you’re looking at improving the property as well, we do have products that we can look at as an option for you to rehabilitate the property. So what’s the maximum loan-to-value for investors, and is it income-dependent? So, the maximum loan to value for purchasing is a 75% loan to value.

27:23
Kyle Mazzuchin
It can differ depending on a couple of items, such as if you want to qualify with your income in Canada with the income letter, we can definitely do that, or we do definitely have some other options for you based on debt servicing or DSCR or projected rental income, but that could come in at a slightly lower loan to value. So, definitely, there is a recording that will be sent out over the next little while. So, it will probably be out in the next ten to 14 days, posted on YouTube and all of our socials. So, which of the states you highlighted are the most popular for Canadians to own? So, it definitely happens in two different ways. So investors are looking at Ohio, Illinois, and probably southern Ontario. A lot of individuals who live down there look at the adjacent states.

28:27
Kyle Mazzuchin
So New York, Michigan, Ohio, Illinois, kind of in a bit of the belt of North America, near the Great Lakes. So, a lot of individuals in that area of the world are looking at those particular states for retirees and secondary homes. You can definitely know that retirees are looking at warmer states. So, Florida is definitely a big option for lots of different communities down there, such as a very big Quebecois community in Florida. Lots of Canadians that are down there are also realtors. So, if you’re looking at purchasing in Florida, we do have some Canadian contacts available to you in those states. Some other popular options from western Canada. So, in Alberta, lots of individuals like to make purchases in Texas. We do have some relationships with some developers in Texas.

29:22
Kyle Mazzuchin
So, if you’re looking at a brand new home, for example, pay attention to our newsletters that go out probably every other day pertaining to real estate topics or themes and trends within different states. Another option is Arizona. Arizona is a wonderful option for Western Canadians looking to purchase a property. And also Nevada. Nevada is definitely popular with Airbnb and transient zone properties, including Florida and California. So, we have another individual here, the 1031 exchange, so you can delay capital gains taxes in us by using it for a similar or more expensive property. So, you want to make sure that whatever you sell is of the same value or higher in order to take advantage of the 1031 exchange.

30:20
Kyle Mazzuchin
If you’re looking at those different options, I highly recommend that you go to a tax professional or a cross-border accountant if you need any sort of options for cross-border. I do have individuals available, and you can also go to our [email protected] in the concierge section. You can have somebody reach out to you from our tax consultancy partner. Are there age restrictions for retirees applying for mortgages? So again, none whatsoever. Fantastic. Very little in terms of risk for anyone who feels that they want to diversify their assets without the need of having any sort of age restrictions. So our other question is, how long would it take for investors with American mortgages to get mortgage approval? So, again, 72 hours is our golden rule.

31:17
Kyle Mazzuchin
We want to make sure that there’s a little bit of time to look at different. If you have a specific corporate setup, we want to make sure that we’re doing our due diligence and asking our lenders. So, for the more complex situation that you may have, we want to make sure that we’re asking the right questions. But for very straightforward applications, 72 hours is our golden rule in getting back to you with conditional approval. So, another question. So, look, got a bit of a three-packer here. So, question one: Is an LLC subject to double tax? So, again, highly recommend that you go to a a tax professional within the country that you’re in. Or go to our [email protected], on the concierge section. Or if you would like somebody from the Canadian side who’s dual licensed, please let me know.

32:09
Kyle Mazzuchin
However, there are tax structures specifically for Canadians. I would just recommend that if your financial picture allows it, you speak to somebody on that side. Is a remote online notary not available, and do other companies offer that? Again, I just think that in order to keep the process standardized and straightforward, different states do different things. So, in order to keep compliant with a lot of complex situations per state, I’d recommend using the apostille stat method with any sort of Canadian notary or lawyer. Okay. Then, there are three HeLOCs available for liquidity as a foreign national. And if you don’t have tax residency, the product is not available. So, just to reinforce that, here are some other questions. So, are interest rates better if you qualify with an income letter instead of a DSCR?

33:12
Kyle Mazzuchin
Again, this is probably from a lender to a lender piece. So, different lenders will have different specials. Definitely, when it comes to having established credit in the United States, you will definitely look at getting a slightly better option. Also, increasing your down payment. So, with that kind of 40% mark, you’ll definitely get a break in your interest rates. So, another question here. If I have a property generating a cash flow of $2,500, how much loan can I get? So it’s a little bit more complex than that. So I would recommend, again, speaking to one of our loan officers, including myself. So, I have my calendar link in the chat. So please go there, click on it, and then see what my availability is.

34:03
Kyle Mazzuchin
And maybe we can chat in order to see how much of that $2,500 we can help you get a loan against a property. So, is an American mortgage broker or a lender? So, American mortgages essentially help with getting financing in that situation. So we definitely can provide you with a myriad of different options in order to make sure that we’re able to place the right loan in the situation that you may have. Okay, so we’re about 535. So again, if you’re looking at any sort of situation when it comes to getting pre-approved for future purchases, please contact us. My Calendly link or contact information will be in our chat and in future correspondence with everyone who has been on this particular webinar.

35:15
Kyle Mazzuchin
A little bit more of an update, just with the most recent changes to the capital gains inclusion tax. So again, we just want to make sure that everyone in Canada has an option when they’re purchasing properties in the United States, whether it be a secondary property or a revenue property in all jurisdictions across the United States. So, as you can see there, just click on the link in the chat. Highly recommend that you book with us in order to explore a lot of our loan programs in all different states. If you have any questions, we are readily available 24/7/365 days a week. If you want to talk on Christmas Day, some people are available, but we have to wait till Santa leaves the particular area in order to be available. So. So again, everybody, that’s our presentation for today.

36:20
Kyle Mazzuchin
If you have any further questions, please ask them in our chat. You can also contact us at any time at Kyle dot mizuchinmericanmortgages.com. Like, follow, and subscribe to all of our socials. We definitely do a lot of different social media posts every other day with our wonderful co-founders, Robert Chadwick and Donald Clip, who have wonderful posts, and with Global Mortgage Group and American mortgages. So that’s it for us for today. Thank you very much, and have a wonderful day.

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Disclaimer: This transcript is AI-generated, so kindly pardon any transcription or grammatical errors that may be present.

04:44
Robert Chadwick
Hi, everybody, this is Robert Chadwick with America Mortgages. Thank you for joining us for this latest webinar. This is a fascinating webinar and it’s often requested dealing with U.S. taxes. Thomas, if you could join us on camera, that would be fantastic. with us today, we have one of our preferred partners, which is Thomas Carden of American Tax Advisers. Thomas is not only a CPA but also a tax attorney. And much like us, where we only focus on providing U.S. mortgages to foreign nationals and expats, that is his job as well when it comes to our taxes.

05:33
Robert Chadwick
So Thomas, with that, if you could introduce yourself and your company and what we’ll do, or the process of the webinar you can go through your slides, explain the process I will go through after that, and we will talk about our mortgages and the process of getting U.S. mortgages a foreign national or an expat. And then for everybody listening and joining the webinar, we will have a question and answer. So as we go, if you have questions, you can drop them into the question and answer box. Also as a reminder, in the chat box, there is a link to set up an appointment or arrange an appointment with either a loan officer with America Mortgages, and this is a 24/7 schedule, or to be able to speak with Thomas or one of his team members. So, Thomas, thank you for joining.

06:27
Robert Chadwick
I really appreciate it, as always. Perhaps you can give us a brief about you and your company and then we can start the slides again.

06:36
Thomas Carden
My name is Thomas Carden. I’m the director of American National Tax Advisors. I think we’re one of Southeast Asia’s largest U.S. tax-specific firms. We work primarily with U.S. expats and foreign nationals who have investments back in the United States. So whether U.S. citizen who has rental properties in the United States or you’re a non-US citizen or resident alien, you can still buy property there. The laws are the exact same for you. There’s no discrimination. And we help handle the tax strategies all the way up to tax planning and the actual tax returns as well. So we’re a full-service shop dedicated to helping people deal with U.S. tax issues with it.

07:20
Robert Chadwick
Fantastic. So let me get your slides. Apologies.

07:24
Thomas Carden
While you’re doing that, Robert, I’ll give a little bit of an example of wealth that can be built up in real estate using the tax advantages.

07:31
Robert Chadwick
Absolutely.

07:32
Thomas Carden
Sam Zell passed away in the last couple of years. He became fabulously successful in buying rental real estate and started off many decades ago with one small apartment building that he converted into university dorm rooms. In 2007, he sold his corporate rental real estate, mostly office towers, for $39 billion. At that time, it was the largest leveraged buyout by the Blackstone group in history. Do this. And he started off by buying one property, using that to leverage to buy more properties. Continuing to grow, and continuing to grow. Continuing to go. One of the biggest, most successful track records of building wealth in history has been through U.S. rental real estate. A lot of people think that the tax advantages aren’t there, but the rental real estate is exactly the exact opposite. It’s meant to build housing.

08:27
Thomas Carden
So there are a lot of tax advantages and tax credits you get for doing this. And we’ll go through and discuss that in detail.

08:33
Robert Chadwick
Yeah.

08:35
Thomas Carden
Way to build wealth.

08:36
Robert Chadwick
I think you’re absolutely right. And I think the U.S. specifically has a very bad rep when it comes to taxes. But when it comes to this type of taxes, and working with experts like yourself, it is the exact opposite, especially if you look at global investment.

08:49
Thomas Carden
Yeah, yeah. And we’ll go through all the tips with that.

08:53
Robert Chadwick
Let me start the slides and we’ll go from there.

08:59
Thomas Carden
Okay. Sharing.

09:01
Robert Chadwick
Double-click to just tell me when you need me to go to the next slide, Thomas.

09:07
Thomas Carden
Actually, I’m not seeing the slides at this particular moment. I said Robert had started screen sharing. Double-click to enter full-screen mode.

09:17
Robert Chadwick
Can you not see the slides?

09:18
Thomas Carden
And then I’m in a black one. Is anybody else seeing slides or is it just me? Yeah, I’m not. I’m just getting a blank screen here of black, Robert. Again, it says that Robert has started screen sharing. Are you, are you looking at your screen now, Robert, on your screen?

09:43
Robert Chadwick
Try again here. 1 second.

09:45
Thomas Carden
No problem at all.

09:48
Robert Chadwick
Can you see that?

09:49
Thomas Carden
There we go. Perfect.

09:50
Robert Chadwick
Perfect.

09:50
Thomas Carden
Okay, so this is my title, my firm. Our website is aitaxadvisers.com. Let me go ahead and move to the next slide. Okay. Through this, we’re gonna go through several different parts of this. U.S. taxation and rental income, taking advantage of deductible expenses, and depreciation. In the end, we’ll give you a little more detail about who we are and how we can help you and give you a consultation if you need one. Nonresident aliens. Now, because this is an international presentation, I’m going to do a feature, a fair amount of information on nonresident aliens. To this. But there are a lot of these things that do pertain to U.S. citizens as well.

10:33
Thomas Carden
Okay, as a John, as a general rule, a non-U.S. person who rents out his or her home is subject to a 30% withholding tax imposed on the gross amount of each rental payment. But, and this is a large but the foreign owner earning rental income can easily have the 30% holding up withholding obligation removed. The foreign owner must only pay tax on net rental income on the U.S. tax return. And that’s a very important part because you’re gonna get a lot of credits and advantages that should very rarely actually show net positive tax on a U.S. tax return. Next slide. Now there are a myriad of different things you can take off as a deduction from that gross rental income. So that 30% tax is not based upon your gross rent, it’s based upon your net rent.

11:25
Thomas Carden
Property management fees are going to be the big one, especially if you’re owning. When you’re living overseas outside the United States, you’re going to have a property management company. Those fees are 100% deductible. Advertising and marketing. Should you choose to run ads in the local paper or Facebook that you’re paying for, advertising and marketing are absolutely free and that includes using a service that will do the advertising and marketing for you as well. Leasing commissions. Should you pay a real estate agent or anyone else for a commission to get a lease? Totally deductible. Repairs and maintenance. This is a big one. So anything you’re repairing so the doorknob breaks, that’s the thing. If a door needs cracks or something if a facade needs to be repainted because of a scratch or any type of thing like that. Totally percent covered.

12:16
Thomas Carden
The pipes break. You’ve got that as a deduction expense. Utilities. Now some people have, and some landlords pay the utilities. Some people have, some landlords have the tenant pay the utilities, but the landlord is paying the utilities. Again, it’s a deduction off of that gross rent, thus reducing that 30% down and down property taxes. So you’re going to pay, when any local jurisdiction in the United States, you’re going to pay some type of property tax. Those are deductible. And then insurance, obviously you’re going to have insurance on the property. Those fees each and every year are a nice deduction for you. Next slide. Mortgage interest, this is, this gets to be really important down the line on this. Your mortgage interest on a rental property is 100% deductible against the income on that rental property.

13:07
Thomas Carden
Now, using that later on as a strategy becomes very important because by refinancing your mortgage at a later date, you can take out, cash out of your rental property and have no taxation on that adjusted loan for this. We’ll go back to that later on. Legal and professional fees, even your tax prep are devoted to that. That rental unit is deductible. License and permits. Should you choose to build a pool or put a fence up where you need a permit and a license, those are deductible homeowner association dues, deductible capital improvements, and depreciation. Now this is going to be really important here because depreciation varies heavily from a repair. Okay. Depreciation is any structure that has a lifespan, generally more than a year. And it would generally be an improvement.

14:05
Thomas Carden
So if you have a base piece of land, the first thing you would depreciate is if you put a house on it, you would depreciate the house over 30 years. And that means the 30th of that house gets used as a deduction each and every year off your tax return. So if you build a $300,000 house, you get a $10,000 expense each year against your rental income on that property that comes to it, now, should you go in at some point and buy an existing property and put a new roof on? A new roof will have an extended lifespan because it’s not a repair, this is a new roof on the property. You would be able to depreciate that roof over so many years.

14:45
Thomas Carden
Should you put in a new washer and dryer, you’re going to have about five years to expense that thing out. What this does is depreciation. And the mortgage interest allows you to be cash flow positive, but tax flow negative. And that’s a real key to this because of all these types of expenses. And a depreciation is kind of paid upfront money and expense. You get the expense over this, over the period of time. By using depreciation, you can be, again, cash flow positive, but tax flow negative. Now, here’s a big one for people owning property in the United States. Your travel to inspect the property is a deduction against that rental property.

15:29
Thomas Carden
So should you choose to go in and see that property once a year to inspect it is a deduction off of that gross income through this with us, there’s also some stuff called pass-through deductions where other types of expenses can be passed through as well to you. Next slide, please. We’re going to go through the depreciation here. Okay. In real estate terms, rental property depreciation is a basic accounting principle that effectively allows you to deduct the cost of a large asset with a useful life of one year or more or a longer period. In effect, rental depreciation, thanks to phantom expenses, can help product tax advantages by offering you means to move into a lower tax bracket to do away completely with any income tax bills you might face. Now remember that 30% tax you had on the end of it?

16:21
Thomas Carden
We’ve already taken all the other expenses away with this including the mortgage interest off this. But when you factor in that you have one 30th of the house being deducted each year, you’re probably going to break even from a tax standpoint to even potentially lose money. Now here’s the other thing. If you are a U.S. citizen, you’re able to take a loss on your rental income in excess of this a passive advantage. So you can take $25,000 a year against your regular income, and you’ll say your salary as long as you’re below certain minimums, it’s about $125,000 a year before that phase-out begins. But you can actually take your $125,000 income and move that down to $100,000. So not only do you save tax off the rental income when your cash flow is positive, guess what?

17:12
Thomas Carden
Your salary gets less taxed with this as well. So that’s one of the biggest advantages. And why lots and lots of Americans are middle-income earners on rental properties because they greatly reduce their tax on their salary as well. It’s one of the biggest reasons why to own one or two rental properties if you’re a U.S. citizen in the United States. Let’s go to the next slide. Okay. Oh, sorry, we’ve shortened this one a little bit. Okay. We’ll go through a couple more items on this stuff too. So rental property gives you so many different advantages on what you can do with this. It’s tremendous. And what Sam Zell was doing was, and this is the real strategy to this. Sam Zell bought one apartment building.

17:59
Thomas Carden
He was able to go in and he converted it to dorm rooms and he started renting it out. Oddly, he figured out the Schick ideal time for college students was very simple, almost like a loft style. So he put that into his first building, and he started becoming cash flow positive on this property. And guess what? After a few years, he builds equity in that property. Now, that equity is very important because you can do two things with that equity. You can choose to pull that equity out and take cash out to this. In fact, generally, after about five to seven years, you’ve got the property in a high enough increase because of a, generally an 8% to a 10% increase, you could pull all your original money out in the value of that you put in that property. But guess what?

18:47
Thomas Carden
You still own the investment. It allows you to do that. But if you don’t want or need that cash at that particular time, you’re able to use that equity as a down payment towards the next property by refinancing and using more leverage. Robert can probably explain that a little better to you later on by doing this, but it allows you to start building those properties one by one based on your initial investment. And here’s the wacky thing about rental real estate from a purpose of this. You really don’t want the rent to break more cash flow positive to you, especially in the first five to six years. And let me explain the math on this, okay?

19:30
Thomas Carden
If you buy one property for $250,000 you have no mortgage, and you’re making an 8% yield, it’s going to be less than $25,000 a year of income to you, okay? And that could potentially be cash flow positive or taxfill positive because you have no mortgage interest. However, let’s say you go and buy four rental properties for a million dollars with your $250,000. You now have a million dollars of property. So prior to that, the first property where you’ve only bought one, at $250,000, you might get an eight to 10% appreciation each year. But when you use leverage and you buy four properties, and you’re getting an eight to 10% increase each year in the value of the property, suddenly you’re making $100,000 a year instead of slightly less than $24,000 to $25,000.

20:21
Thomas Carden
So if you look at real estate as a long-term growth in this, and you let the debt be covered by the rental real estate, you are negative, cash flow positive. But you are building wealth at an incredible rate with this, where else you’re going to get an investment, you put in $250,000 and get $100,000 a year growth. It’s really rental real estate with it. There’s a whole lot of options on this. Now, one of the things we do each year for America Mortgages clients. If you contact us through email in the last slide, as our contact details on this, we’ll give you a free half-hour consultation. Talk about your specific tax issues. That’s about a $300 value for you.

21:05
Thomas Carden
And we can go through your specific tax issues that’ll help you cover this in a real way. And we can also go through, there’s already a great one on setting up an LLC. We can help you do estate planning on this. We can help you minimize those taxes depending on how you set up and where you’re from. You can also even look at tax treaties and get even more efficiency in your home country, depending upon the country you live in. There are a lot of tax advantages in these processes that will help you save some money and help you grow your wealth. And that’s the whole idea. Use this to grow your wealth.

21:39
Robert Chadwick
Thank you, Thomas. Super interesting as always. I know the slide was actually quite short, but I’m assuming, like we have with other webinars with you, we’ll have a lot of questions. I think the question’s already starting to build in the chat, but just to, I guess, discuss what you were just talking about, the depreciation that you can take to offset the income, whether you’re being, whether you’re a U.S. citizen or a foreign national, how does that work specifically?

22:17
Thomas Carden
Okay, well, one of the second rules of real estate is, well, the first rule of rental real estate is to buy rental real estate. The second rule is never to sell rental real estate. The United States has some interesting things about this because if effectively, the idea in the U.S. tax code is that the house, the building structure itself, will go to a zero value over, say, 30 years. Okay? So if you put a $300,000 house, the tax code effectively says that the value at the end of 30 years will be zero. So each and every year on that $300,000 house, you’ll get a $10,000 deductible expense against that house.

22:57
Thomas Carden
Now, we all know that a house 30 years from now is probably going to be worth more money because the replacement cost of labor and all those kinds of things and materials go up and up. But the tax code does not do that in any real way. So it gives you an expense off that property. Now, this is the reason why you never actually want to sell rental real estate, because when you do sell, you would have to recapture that depreciation off of the rental property. But what you don’t do is you never sell. What you do is you go back to America Mortgages, you’d get a new mortgage, pull your cash out, still own the rental property, and allow it to grow. Now for some reason, maybe the neighborhood is deteriorating, and the house is becoming too much maintenance.

23:41
Thomas Carden
You can do what’s called a like-kind exchange and move from one rental real estate property to another rental real estate property and have no tax consequences on moving from one to another. You can also buy a more expensive property with the new mortgage to this, and continue your mortgage that way with it. So as long as you never sell a rental real estate property or you just exchange from one to another, you get very large tax advantages. And like I said, you can buy more tax property, and more rental properties over a period of time. You can take your cash out should you choose. I’m over-leveraged now. I have too many rental real estate properties that don’t want to buy anymore.

24:21
Thomas Carden
You allow them to become cash flow positive and you can begin to pull your money out just by refinancing mortgages on a regular basis. This has been a strategy that has worked over the decades. Google Sam Zell’s story and you can really see how this works very well. It’s a way to build tremendous wealth.

24:41
Robert Chadwick
I also think that and correct me if I’m wrong, or anybody can correct me in the chat, but besides the fact the U.S. has no stamp duties, the ability to minimize or even, sometimes mitigate capital gains tax, which is certainly something that everybody has to deal with in the U.S., whether they’re foreign, national or expat, can be done with effective tax planning, either through a 1031 exchange like you just explained, or even carrying any tax loss forward and deducting.

25:15
Thomas Carden
The code is meant to be if used properly, is meant to be in a way that’s set up to beneficial to landlords and they’re very landlord friendly. Now, some states will vary depending on their individual policies of tenants and stuff, but from a federal government standpoint, it’s very friendly. They want landlords to be able to increase the supply of houses in the United States. There’s still a critical shortage, as both you and I know, Robert, housing in the United States. So the tax code has always been very friendly in providing more housing supply. And the way to do that is to make the tax code friendly. If you tax something less, you’re going to get more of it.

25:59
Thomas Carden
And that’s why these codes are set up and structured in such a way that you can pull money in, you can pull money out when you need to, you can put money in, you can buy more rental units, and you can begin to build your structure over this. I’m 54 now and I wish I’d bought three rental properties when I was about 24 because it would probably be 50 rental properties now by just constantly rolling these things over to this over and over again. And you know, the rental yields right now vary between your areas to this. But around 8% rental yields, you can cover your mortgage, you can cover all the expenses, you can cover the insurance, all those things with this, and then that property will grow at about 28% to 10% over a year.

26:44
Thomas Carden
Over years by historical track records. Now, again, you put $50,000 into a house and get a mortgage on that house. Your rental yield is not based, the yield on that increase in the property is not based on your $50,000. It’s based upon the $250,000 you put into it, a 10% yield. If you get a good yield going on that growth of that, the sale of the property, house value, you’re making $25,000 a year in net worth increase. You’re not going to find that anywhere else with it.

27:16
Robert Chadwick
Absolutely agree. I think. Sorry, go ahead.

27:19
Thomas Carden
The rent should cover the debt service and expenses. Let the value of the property work for you.

27:25
Robert Chadwick
Now, I think, especially as we talk to a lot of clients who may not be curious about buying a U.S. property and obtaining a mortgage, a lot of this has to do with educating them on the fact that taxes in the U.S. are actually very favorable when it comes to owning investment properties. So I’ll go through my slides now and then as we go forward, we can talk a little bit more about the taxes and questions and answers and so forth.

27:58
Thomas Carden
Sure.

28:00
Robert Chadwick
Hopefully, I can share my screen properly this time. Can you see the slides?

28:08
Thomas Carden
I’m still black here, unfortunately. I think you need to swap off to where you’re seeing your senior self.

28:22
Robert Chadwick
A little bit of technical issues. Apologies. So again, thank you everybody for joining. We will go over what we can do when it comes to U.S. mortgage-providing foreign nationals and expats. Again, 100% of our clients are living and working abroad, but obtaining a U.S. mortgage, whether it is for a purchase or for a refinance or cash out. So, in the general overview, no U.S. credit is required. We prefer if you have a credit report from your home country however, we do realize that there are some countries that do not have credit reporting agencies and we can actually work around this.

29:13
Robert Chadwick
But if you are, say, in Canada, for example, and you have a credit reporting agency, or even in Europe or wherever it may be, if you can provide your current credit report, then we will use that in lieu of U.S. credit. No AUM is required, as we do a lot of work with private banks. The issue with private banks is they obviously don’t want to lose AUM. So all of our loans are what’s considered dry funding, meaning that you do not need to open up a bank account with any type of bank that’s going to be providing the mortgage. We allow foreign-earned income. Doesn’t matter what currency. It’s accepted just as if you were earning your income in U.S. dollars. Loan programs in all 50 states, which is absolutely fantastic, really open your options.

30:12
Robert Chadwick
If you’re a foreign national, you can get up to 75% loan to value on a purchase, and 70% on a refi. And if you’re an U.S. expat, we try to make it exactly like you’re living and working in the U.S. and walking into a bank, and you can get 80% on this type of property. Normally, once you submit your paperwork, and we have a very slick platform that we just launched that allows you to take the application online and upload all the documents securely, once we have that, it takes us approximately, I would say 72 hours, often sooner, to be able to issue you a loan approval and a pre-approval letter. Once you have that pre-approval letter, then you can actually go shopping. If you do not have this letter, most realtors or sellers of the properties will not accept your offer.

31:09
Robert Chadwick
So it’s very important before you do anything, that you actually get pre-approved for a loan. On average, closing times are 30 to 45 days, which is fairly quick. That is for a standard conventional mortgage. We do have loan programs. In the event that you need liquidity very quickly, that we can close in a week, you can sign your closing documents in most countries, so there is no need to travel to the U.S. And there’s a variety of ways to close your documents, from online signings to visiting the embassy, to even signing at a local notary. If the country that you’re in is part of the Hague Convention, they can just get an apostille stamp. We have 30-year mortgages, regardless of the borrower’s age.

32:04
Robert Chadwick
I know this is a very unique thing to the U.S., and it actually is another reason why U.S. real estate investing is by far the best market absolutely in the world. I don’t care if you’re 19 or 99. In the U.S., you cannot discriminate against anything, marriage, status, sex, whatever it may be. And age is one of them as well. So the U.S. allows that if you’re 19 or 99, you should still have the same mortgage options. So age restrictions do not matter. A 30-year amortization, and we even have 40-year amortizations, will allow you to be able to maximize your yield by stretching the loan out over the longest period of time. We even have a ten-year interest-only program.

32:56
Robert Chadwick
This is absolutely fantastic because what it does is it allows you to pay only the interest for a ten-year period but at a fixed rate. And after that ten-year period, you would expect that rate to readjust to whatever the prevailing rates are. However, it stays at the same rate that you fixed ten years ago, but now you’re just paying principal and interest, so you have a total of a 40-year tenure. If you’re looking to maximize yield, this is the loan I would suggest every single time we do common-sense underwriting. And what does that mean? Well, if you were going to buy an apartment building, you surely would not qualify on your personal income. And your personal income obviously has nothing to do with the rental income. And this is how we look at investment properties.

33:51
Robert Chadwick
So in most cases, you’re going to qualify on the cash flow of the property and not your personal income. If you’re self-employed and or maybe don’t show what your true income serviceability is of debt. This is a perfect loan because as long as the property cash flows, the loan qualifies. And I’ll go into that in a little bit more detail. We are super proud that 97% of our loan applications are approved. And this is because our loan officers and I truly believe this is the best. They are all over the world. They focus only on providing U.S. mortgages to foreign nationals and expats. This is all we do. There is literally nobody that does this any better. And not only are you not having to stay up, say, at 03:00 a.m.

34:46
Robert Chadwick
To talk to somebody in New York about your mortgage, you are working on your time, and the loan officer or whoever is dealing with you on our side will actually be the one staying up at 03:00 a.m. to deal with this. So it’s a really simple, easy way to do the process. So I’ll go through the loan programs really quick and then we’ll do our question and answer. So this is by far our most popular loan program. And this is what we discussed. This is called the AM rental coverage plan. What this means is you do not need to provide your personal income. You’re going to qualify on the subject’s property’s rental income. We have loan amounts on these loans as on these programs, as low as 100,000 U.S., and all the way up to 3 million.

35:40
Robert Chadwick
Again, 30-year fixed and interest only, regardless of age. And if you look at how you qualify for these loans below, it is an example. So when we get the appraisal or the valuation report, we will also request one for the rental, and that is the amount that you will use to qualify. So in this example, if the rent is $2,400 and the mortgage, which includes the principal, taxes, and interest, is $2,400, the loan qualifies. It’s a dollar for dollar in the event, say, the rent is coming. In short, it does not mean that the loan does not qualify. It just merely means that you may have to put a little bit more than 25% down.

36:35
Robert Chadwick
So either way, and this is sort of how we get this 97% approval rate, either way, we can normally get your loan over the line, and again, 30 to 45-day closings, no U.S. credit or residency required. So am Student Plus, if any of you have children who are attending university in the U.S., such as myself, you realize that normally the first year they have to live in the dorm. After that, of course, they can live outside of campus. As Thomas had explained, purchasing these properties around campus is absolutely a fantastic way to be able to not only have constant rent but to be able to even maximize what you would be able to get, maybe further away from campus. So in this particular case, the student is the tenant of the property, and that’s how we look at it.

37:37
Robert Chadwick
So again, this is another loan where that does not qualify on your personal income, but it qualifies off of the projected rental income of the property. And if your child is 18 and says they intend to stay in the U.S. and we can add them to the loan, it is absolutely a fantastic way for them to start to build their U.S. credit. And as you know, if you intend on living in the U.S. and doing anything, having credit is paramount. It’s absolutely important. And this is a good way to put your child straight in the right direction. On this loan program, there is a minimum loan of $150,000 and we can go up to 3 million. And again, it’s a very similar example to the rental coverage loan that we looked at earlier. The AM investor plus.

38:34
Robert Chadwick
Okay, this is actually a hybrid of a loan program. So as an example, perhaps you start out with doing the rental coverage loan, but on this particular loan, say you don’t qualify or the property doesn’t qualify on cash flow, you can actually qualify using your income. But because we’re doing loans for clients all over the world, certainly it would be very difficult to go through everybody’s tax returns. So what we do is we use an income letter. If you’re employed, we want a letter from your employer on the letterhead stating two years of income and the current year to date. If you’re self-employed, the same thing, but it’s from your accountant and we have a template for this which makes it very easy to follow. So you will qualify on that as the income rather than providing your tax returns.

40:10
Robert Chadwick
Again, loan amounts on this particular program are 150,000 and up, but we can still do up to 75% financing. If you look at the example below, it shows how you would have to qualify. We go off of your gross personal income, not after taxes, before taxes. And we need to get at least a 43% debt-to-income ratio, which I’m sure everybody, if they are real estate investors, do understand that in their home country, this is a very similar way to do this.

40:48
Robert Chadwick
if you are a U.S. expat. Again, as I said earlier, we try to make this loan program as if you were living and working in the U.S. and you just walked into your local bank. We have the exact same rates as you would be able to get. You need to provide two years of your U.S. tax returns. There is no requirement to have a W-2. So if you work for a foreign company that does not issue a W-2, that is no problem as long as you’re still filing taxes. We want you to have at least a 680 credit score in order to really get the best opportunities with these programs. And again, loan amounts as low as $150,000. This also qualifies on a 43% debt-to-income ratio. So again, we go off of your gross income on your tax returns.

41:41
Robert Chadwick
And as long as we are looking at a debt the housing and whatever debt may be for credit cards or so forth, as long as that is below 43%, the loan should qualify if you are a high net worth individual. And when we started this company, our initial, I guess our initial business model was working with private banks. So these programs were super effective and actually quite easy for high net-worth individuals to qualify for. As you know, if you have a high net worth or you’re working with high net worth individuals, they could have very complex and very complicated tax returns, multiple jurisdictions, structures, etcetera. With this loan program, they can actually qualify on their liquid assets. And this would be tax, this would be cash in the bank, stocks, bonds, and even crypto.

42:45
Robert Chadwick
What we would do is we would take a two-month average of those accounts. We would divide it by the fixed period of the loan, and that would be the income to qualify. So if you look at the slide below, it gives you a very simple explanation of it. So, in this account, if somebody has a portfolio of, say, $5 million, we would divide it over a five-year period, and that would be the fixed portion of the loan, but the amortized portion would actually be 30 years, but the rate would be fixed for five years. But that would give us an average income of $83,000. And as long as that mortgage payment is below that $83,000, the loan would qualify. The best part about this loan program is there is no encumbrance on the portfolio that you use to qualify.

43:40
Robert Chadwick
So if you use, say, a stock portfolio or bonds, and you used it to qualify, the day after the loan closes, you can trade it, you can sell it, you can do whatever you want. Fantastic program for high net worth individuals. So we have offices basically around the world, but our main office, obviously, is in the U.S., and we’re in the Asia banking capital of the world, Singapore, which I think gives us a lot of advantages and opportunities. So with that, I will open this up to questions with Thomas and me. So, Thomas, what I will do is I will read the question, and then if it is based for you…

44:27
Thomas Carden
I have to give the legal clarification that I’m only talking to these in generalities. I’m not your tax advisor until you hire us. So I can answer general questions. But if you’ve got a very specific question about your tax situation you need to come hire us and discuss it. But we’ll discuss generalities now and give you guys as much help as we can, yeah, absolutely.

44:48
Robert Chadwick
I think most of the questions, as we seem to always have, are acceptable.

44:53
Thomas Carden
Oh, yeah. That’s why there’s a little bit of legal clarification because sometimes people will take something because I just don’t have enough information about your personal situation to give you full legal advice at this particular moment. If you do need that, give us a call and we’re glad to help you out.

45:08
Robert Chadwick
Sounds good. With that said in the chat, there is a link to set something up with either America Mortgages or with Thomas and his team at American tax advisors. American international tax advisors.

45:22
Thomas Carden
Yep.

45:23
Robert Chadwick
Okay, so first question. Will there be a recording? Absolutely. Just like all of our webinars, it probably takes a week to come out of post-production, but it will be emailed to everybody that has either signed up and attended or even if you have not attended, it will also be available. And we have a lot of webinars available on our YouTube. If you have any questions regarding almost anything U.S. real estate related, and even an old interview with Thomas, that’s all available on our YouTube. America mortgages. Next question. This would be for you, Thomas. Do you charge an hourly rate on tax consultations?

46:10
Thomas Carden
Yes, we can either do a half hour or a full hour. Generally, our rate is 450 for a full hour. However, if you email us, Chris taxadvisors.com, my practice manager, you get a free half-hour consultation just because of our relationship with America Mortgages. So that should give you all the incentive in the world to give us a call with it because it’s a $225 value that we give you because you’re coming in through America Mortgages as a referral.

46:38
Robert Chadwick
That’s fantastic. Thank you for that, Thomas. And so I think everybody, if they do, I highly recommend Thomas and his services. I think everybody that we have referred to you has been more than pleased. More than pleased. Next question. Is this assuming the property is owned by an individual as compared to an LLC? Very good question. So last week we actually had a webinar from a company that sets up LLCs, and you can actually even go to our website and you can set up an LLC through our website using this partner. But in general, you should be able to purchase a property in an LLC. And if people are not familiar with an LLC, and maybe, Thomas, you can cover a bit of this as well.

47:32
Robert Chadwick
But it’s just a fantastic way to not only maybe optimize some sort of tax advantages, but to be able to mitigate any liabilities that you may have within the property. For us, we are an actual mortgage bank, we require you to do the transaction with an LLC. But if you do not, there are options. And Thomas, I don’t know if you want to kind of just briefly talk about an LLC.

48:02
Thomas Carden
But yeah, I mean, LLC stands for limited liability company. Okay. And one of the biggest advantages of it is it is exactly that. It limits your liability. Now, people for various flavors, and depending upon your situation, some people will do this as a C corporation, some people will do this as an S corporation, a limited liability corporation. And there are a myriad of different flavors and tax strategies depending upon how you do this. If you just want to own one property, the cost may not be there. But if you’re planning on building an empire of this over a period of years, a company structure is generally better and more cost-efficient for you. And that’s really where in your specific situations, come talk to us.

48:46
Thomas Carden
We can give you the flavors that you want to go through and strategies for how you approach this. But generally, a limited liability company is generally the best for this. And that limited liability company doesn’t have to be U.S.-owned. It can be owned by another company overseas. In fact, here’s a little bit of a trick for you. If you’re living over, if you are not a U.S. citizen or tax resident, you set up a foreign company, say, in Singapore, that owns a U.S. company. Now, when you want to go sell your properties out, if you can find another investor who wants to buy the Singapore company, they’re buying that shares in that Singapore company. And guess what? You’ve never sold the property in the U.S. You don’t have any U.S. tax liability.

49:27
Thomas Carden
You’re selling it based on whatever tax rates are in Singapore. Because you’re selling a Singapore investment company with this globally. That’s a way to begin to minimize your tax globally and handle this. Also, when you’re coming into different company structures, you don’t have any estate tax issues because it’s not tied to an individual. It can be tied to a company with a limited lifespan. It’s a way to minimize the potential estate tax on these properties as well.

49:55
Robert Chadwick
Fantastic advice. Thanks, Thomas. Next question. Are there any specific states that offer more favorable tax conditions for non-U.S. citizen investors? Very good question.

50:08
Thomas Carden
Well, this is one of the great things about the U.S. Even at the state level, it’s non-discriminatory. Discriminatory. So you have, as a non-U.S. citizen going in and buying a rental property, you are treated the same as a guy who lives in California, Texas, or Nevada to this. There’s no difference on how you’re treated tax wise enough. Now, if you’re overseas, you may not be aware that the states have their own tax codes and there’s 50 of them. To this, you have two different layers of tax. You have federal tax and you have state tax. Now, several states like Washington state, Texas and Florida have no state tax whatsoever. Highly like buying rental property in Texas. Very landlord friendly as well. But you just don’t have any income tax that you have to deal with in Texas as well.

50:55
Thomas Carden
So when you’re looking at rental properties, you know this go state by state. I can tell you that one of the least landlord friendly states is California and also one of the highest tax states as well through this. But when you’re looking at that state by state, you should look at which is the most tax friendly for you through this. It’s a very big part of this because it can change your yield dramatically.

51:21
Robert Chadwick
Thank you. Next question. How do I manage taxes if I own multiple U.S. properties?

51:28
Thomas Carden
The biggest issue of this is you need to segregate the expenses in your accounting system by property. When you’re doing this books, if you’re hiring a plumber and you have, say, five houses, you would segregate that expense off to one particular rental property with us. That way, that schedule e, where all this gets reported on tracks to that particular house. So it’s literally each house sort of becomes its own little business entity from an accounting standpoint. And that’s reported through your tax structure with it. And you can sit there and generally when we do, because we do 1040 non resident returns with rental properties, we do a bunch of them. Okay. And one of the advantages of that is we’ll sit there and walk you through to this.

52:14
Thomas Carden
And when we’re preparing your tax return, generally we’re going to sit there and give you tax tips as well and say, hey, you want to do this, you want to refinance, you want to plan and strategize. And that process tends to happen about each year you’re doing a tax return with this. And so as you move forward each year, you get a little bit of tax tips when you’re preparing your tax returns. That’s one thing a high quality tax firm will do for you, is help you manage that on that yearly process as you’re doing your tax return.

52:41
Robert Chadwick
Thank you, Thomas. Next question. As a foreigner using an LLC, what we have to first do tax returns for the U.S. LLC and then pay U.S. taxes. If any taxes under a double taxation treaty deal with our native country tax system. In quotes “Australia”. Is this correct?

53:04
Thomas Carden
Okay. Yes. You have to do the U.S. tax return in the calendar year after the rent is received. Okay. That will be the exact same with it. Now, because we’ve got so many different nationalities here, there are different tax treaties that will give advantages on particular things. It may say that any rental income can only be taxed at 5% or 10% or 7% in the United States and then the remainder it is taxed in your home country. Each tax treaty is different than that. However, that’s generally on your net income you receive with this, you generally, in rental property, never want to receive net taxable income. With this. It always calculates out to a negative, should calculate it out to a negative number. By using depreciation and financing and leverage, you’re able to minimize that tax flow in the U.S. So with proper planning, you shouldn’t have any tax at all.

54:08
Robert Chadwick
Fantastic. Nobody likes to pay taxes.

54:11
Thomas Carden
Amen. Amen.

54:14
Robert Chadwick
Next question. You mentioned LLC. If it was a Wyoming LLC is set up to buy a property in a different state, say Texas. What are the tax implications in each state? Are there required filings in both states?

54:35
Thomas Carden
Yes. Although you’re in two states, that it’s fairly minimal with it, and that’s one of the advantages of picking tax advantage states with LLC situations. You’re going to be fairly minimal in each of those two states and that will vary wildly based upon all the states you’re in with it because again, personal income is not taxable in some states, and other states it is you’re going to have to go by a state by state basis on that. But with the two states you talked about, you’re about as minimal reporting as you’re going to get.

55:05
Robert Chadwick
And from my understanding, and again, correct me if I’m wrong, you’re only paying tax in the state where you’re earning the income, not where the LLC is registered.

55:14
Thomas Carden
Generally, yes. Again, that can vary by LLC, state by state, but you generally want to go Nevada, Wyoming or Delaware and minimize that reporting when you set up the LLCs.

55:27
Robert Chadwick
Perfect. Next question is New York City. Manhattan condos the worst kind of investment in terms of value and costs. Hence, looking elsewhere in the U.S., which U.S. bank should I open with? A B-1, B-2 Visa. Any suggestions? I plan to visit Arizona after New York in August. Let me touch on this a little bit, because it’s a little bit of a… New York is a pet peeve for me. But maybe you have some suggestions as well. I think unless you’re looking to buy a trophy asset, New York is not a good, well, Manhattan anyway, is not a good place because I just don’t see, you see a good rental yield. Taxes are very high.

56:14
Robert Chadwick
And even though we say the U.S. has no stamp duties in Manhattan, there’s a mortgage recording tax, which, if I’m not mistaken, is 1.5%. And then there’s a mansion tax, which also California has, which is 1%. So you’re basically paying a 2.5% stamp duty on a probably overpriced property that you’re not going to get much yield on. Maybe capital appreciation. I don’t know, Thomas, maybe you can kind of expand on this a bit.

56:43
Thomas Carden
I would add California into this mix as well. And both of these states are very heavily bureaucratic. They are very aggressive at going after any dollar they can get in potential tax revenue with it. And overly bureaucratic and not landlord friendly at all to this. You get a bad tenant in these states and you can just YouTube bad tenant stories and they’ll tend to be in California, New York, because their laws are very friendly towards tendency. We don’t have to pay anything with this and squatting laws and all sorts of issues with this. There are places in states that are growing traditionally in the south of the United States, and that includes places like Nevada, Las Vegas, Texas, again, is very friendly. Georgia, South Carolina. South Carolina right now is booming.

57:35
Thomas Carden
I’ve been truthfully been online looking at rental properties around York, South Carolina, because there’s a lot of manufacturing moving into that area. If you look at where the trends of where manufacturing and the people who will need these kinds of jobs are going, that’s into the south and into the southwest. Look at those trends, because New York, it’s got a long way to go before it clears up its landlord issues. And California is the same way.

58:02
Robert Chadwick
I absolutely agree, and I think that has a lot to do with the fact that people are moving out of these states, moving into more business friendly states. Next question. How many months of salary statements or pay slips do you need on average? Well, this actually works out quite well for you. If you’re a U.S. expat and you’re qualifying off your U.S. taxes, then we’ll need to see two months of your salary statements. But if you are a foreign national or, say, a U.S. citizen and you want to qualify only on the rental agency income of the property, that is not required at all. We’re not going to ask for any personal income. You’re just going to qualify on the rental income of the property. Next question.

58:47
Robert Chadwick
Should I preserve my Hong Kong based income, that is, salary, for example, not necessarily equities, assets or cash assets? I think the question is basically saying, should I buy equities or keep cash in maybe a high yield account, or should I buy real estate? And I think we both know the answer to this.

59:21
Thomas Carden
Any type of portfolio should be varied across the board with it. You should have stuff, multiple nations, especially more and more of a global situation to this. If Hong Kong tanks for some reason, the U.S. may be strengthened to this, generally the U.S., especially for immigration issues. Should you have to go somewhere if you’re an investor in that country, and I’m not going to guarantee it’s not an immigration advisor, but having invested in that country helps your status if you want to try to get into the United States. That’s just a general concept. So if you do have several of these, you’ve lowered your risk for that. And again, one of the nice things about this is the way the yield works. Ideally, the rental payments cover the debt service, they cover the insurance.

01:00:10
Thomas Carden
And so this thing comes out slightly cash flow positive, but tax flow negative. But the valuation on that house increases on annual basis by about 8% to 10%. Historically, over a longer period of time with it, that’s just almost set in stone. And if you look at areas that are growing again, like Texas or South Carolina, you’re going to have a lot of jobs moving in and the property values and those states will generally increase at an even faster rate. So you’re putting $100,000 investment in and say you buy a $500,000 house with us. That capital appreciation of that value of the house is at eight to 10% isn’t based upon your hundred thousand dollar investment. It’s based upon the $500,000 value of the house.

01:00:56
Thomas Carden
Guess what, guys. That’s a 40 to a $50,000 net capital increase in your net worth each year based upon $100,000 investment. You’re not going to find that in a whole lot of other places. That’s the strength of rental real estate.

01:01:12
Robert Chadwick
I absolutely agree, and I think that’s something that a lot of people don’t think about because especially if you’re getting leverage in a mortgage, the yield you’re getting is the yield that you’ve borrowed the money on. Exactly so you certainly, if you’ve done this wisely and you have the proper tax advice and the proper mortgage, you’re certainly going to see a significantly higher yield. And I think in general, having U.S. dollar exposure in owning U.S. real estate for that reason is quite good. It’s still a fairly liquid asset, depending on what you want to sell it as. Next question. I’m a freelance entrepreneur without regular income. Can I qualify for a mortgage? This is super common with us. It doesn’t matter to us if you’re self employed or you’re employed.

01:02:06
Robert Chadwick
If you’re qualifying off of the rental income of the property, your personal cash flow is not a concern. It’s the cash flow of the property that we want to see. So absolutely, there are no issues if you are self employed and perhaps do not show what your true serviceability is. Next question. Are there any restrictions on the types of properties eligible for investment loans? No. In general, I mean, certainly some countries do have restrictions on certain types of assets that they can buy. I believe in Texas, farmland is not an option if you hold certain passports. But for us, when it comes to providing a mortgage, we can do everything from residential all the way to commercial, and size is not an issue. So certainly our own mortgage bank, we can only do up to one and a half million.

01:03:08
Robert Chadwick
But if you have a property that’s worth 100 million, we have done these transactions and we can facilitate. Next question. Can America mortgages help connect foreign investors with local real estate agents? This is an excellent question, much like partnering with Thomas’s group and other groups similar. We also partner with realtors that we have worked with in the past or realtors that we have vetted. So if you get pre approved for a loan and you’re unsure of where to buy a property, you can talk to Thomas and discuss what has maybe the best tax advantages. And then once you figure out which state that you want, we can put you in touch with a realtor that we have worked with in the past that also understands working with foreign investors.

01:04:02
Robert Chadwick
And you may think that this is not a big deal, but it absolutely is a big deal because just coordinating time differences, et cetera, it can be a little bit of a challenge. But if we’re working with the same partners all the time, it makes things just much easier. Next question.

01:04:21
Thomas Carden
Hold one moment. Robert, you need to add in property managers as well. I know you guys work with some very good property managers because at times you can have a realtor agency who is your property manager as well but you can also hire separate property managers. And I know America Mortgages works with some very good property managers, especially when you’re overseas. It’s a very important thing. And Robert has worked with and found very good quality property managers because that’s a very important skill. And it’s part of the services that they offer. They can refer you to those guys.

01:04:53
Robert Chadwick
Thank you, Thomas. And it’s actually a free service, too. We, we offer to anybody. We want to make sure that the entire process is as smooth as possible, not just from the mortgage prospect or perspective, but all the way through while you’re owning the property. Next question. In am investor plus, do you also consider rental income from the property as the am investor option? Wow, that’s a very good question. Yes, we can. So although you certainly should be able to carry the debt based on the income that you’re providing in the letter, if it is potentially short, we can possibly look at whatever the rental income is being generated from that property as well. Next question. In the U.S.A, do we pay you a fee? In our country, we don’t.

01:05:49
Robert Chadwick
In fact, we get paid by the bank or taking, by taking the business to them. So, yeah, in the U.S., a mortgage broker is compensated by points. And if you think about the process behind this, it absolutely makes sense. Points or a percentage of the loan, which is normally 2% of the loan amount, not the property value, because we work for you as the client and not work for the bank. We don’t take any money from the banks. We charge the client the 2% one time fee. But what that ensures is we’re going to make sure that you have the best loan programs available, regardless of what bank it is. You go to one bank, they’re going to only have that program. We have over 150 different lenders. Besides the fact we’re actually a direct mortgage bank ourselves. Next question. Can you take care both U.S. and Canada cross border taxation?

01:06:59
Thomas Carden
Yes, we actually, that’s really our specialty is cross border taxation. We work everywhere from canadian clients. We have european clients, some in South America, Australia, New Zealand, a fair amount of clients. Our primary headquarters is located out of Bangkok. We tend to specialize everywhere from Saudi Arabia all the way up through Japan. But yeah, we have clients and deal with issues, U.S. tax issues all over the world where actually there’s an online magazine about expatriates that rated us one of the top ten firms globally for doing this. And one of the things that we try to specialize in very specifically is mid market clients. We’re not well do high net worth clients, but we try to help the average person out there handle their U.S. tax issues, whether that be a U.S. citizen living overseas or somebody with U.S. investments to this.

01:07:50
Thomas Carden
So yeah, we’ve got a team of 29 right now and I have to add about twelve people to that in the next twelve months. That shows our kind of growth curve in this. We’re a full service firm. And like I said, one of the advantages of this, because we’ve got a great relationship with America Mortgages. Highly, highly recommended you guys choose Robert, every time. But you know, for, because of the referrals in this situation. And if you’ve got questions, just give us a call. Mention America Mortgages. You got a free half hour consultation, no charge whatsoever.

01:08:23
Robert Chadwick
And again the link is in the chat so you can click on it and make an appointment while we’re online. Next question. I meant today’s tax talk is about LLCs or individuals. Sorry about the confusion on that. Thomas. I think you expand on that. Can this is both applying to individuals and to LLCs?

01:08:45
Thomas Carden
Yeah, both of these things work. I mean the tax code in general in the United States is friendly towards both businesses owning rental properties in the U.S. I mean, I think Blackstone and you’re hearing more and more about these different private equity groups going in and commercially buying rental real estate in the United States houses. And they’re buying these things in mass at one point, although I think that’s calmed down just a little bit recently. The reason they’re doing that is because the same type of tax benefits work towards businesses and large companies, investment companies, as well as towards individuals. I mean, when Sam Zell sold the company for $37 billion, he was using the same basic tax strategies that are available to individuals. It doesn’t discriminate. Now, there are flavors of how this works in that you’re in your tax planning.

01:09:36
Thomas Carden
Depending upon where you are in the world, you may want to own this in a company overseas. You may want to own this in a U.S. LLC. You may want to own this as an individual in times with us. And that’s where part of that half hour consultation and even potentially more when we can help you build a tax strategy that can help you with 400 rental units if you want to, or we can help you with one that if you want to buy one rental property in the United States, there’s varieties and structures on how you deal with all of that. And that’s really where we get into the specifics of your particular tax situation and more importantly, what your goals are with the rental property.

01:10:15
Robert Chadwick
Thank you, Thomas. Alastair, I see your question. Thank you very much. I look forward to your email and it’s great to see you again. Next question. No, I think it was a misunderstanding. Australia will just treat this as an investment in a foreign company, then either keep the money in the U.S. LLC or bring back the income as a dividend. So the question is U.S. LLC tax return first and then native tax return.

01:10:45
Thomas Carden
That’s, that’s exactly how it will flow every time with it. The U.S. tax return will be done first and it’s possible. And again, I have to look at the tax treaty on the Australia that sometimes rental real estate will have very specific tax rates that are available to it. But yes, the U.S. tax return would be done first and then it would flow to Australia. And that’s the basis of any type of bilateral tax surety with it. We actually do have on our specialist. One of our specialists is a former PwC expat tax specialist who worked for several years in Sydney. So I have an Australian U.S. tax expert on hand, although he has left for the day because we’re just about 06:00 p.m. Here in Bangkok. But we can help you, actually help you that. Give us a call and we can go through that specifically if you want to with it. No problem.

01:11:33
Robert Chadwick
Fantastic, Gaz, thank you for the compliment and we’re glad that you were able to join and see some value in the webinar. Next question. What do you make of Miami as a place for investment? Well, I mean, I’ll sort of touch on that. And then, Thomas, you can and expand, but I think we’re both Florida fans.

01:11:53
Thomas Carden
I’m a Florida native.

01:11:54
Robert Chadwick
Oh, there you go. But I think anything in Florida is a great investment. I think Miami is a fantastic city, a very vibrant. I think as long as you can get a good value in what you’re buying, I think it’s fantastic.

01:12:12
Thomas Carden
And I’m from Florida. Love Florida. There’s a lot of flooding at this particular moment. God bless those people in Florida right now or back there. One of the big issues right now in Florida is having a little bit of an insurance crisis just due to storms. And the way the insurance system works in the U.S., being state based. So it’s actually from a rental yields, it’s fabulous from a landlord standpoint. They’re very pro landlord in this, but the insurance cost is a little bit high. What you’re going to find anywhere you get closer to the water in the United States, that can be possible hurricane, you’re going to have some issues. Beachfront property, the prop, the prices are going up just because of base of insurance, of cost and ownership to it. Now generally, the rents will cover that.

01:12:57
Thomas Carden
But that’s one of the more complex things about Florida right now, specifically property insurance on that’s going to be a little stiffer. The more you go inland say northern South Carolina, which sounds strange, north south, but. Or Texas, Houston, there’s a little bit there. But San Antonio, Austin is booming. You’re going to have really great and your insurance rates in Texas are going to be a fraction of what they are in Florida. Not that I bad mouth my home state. I love it. I go back in a few months to visit my family there.

01:13:29
Robert Chadwick
I tend to agree. I think you should always, especially when you’re doing investments, look at the entire investment and so forth. Next question appears to be our last question, thanks everybody. It says, what do you mean you are a mortgage bank yourself? Are you a lender or a mortgage broker yourself? So we are both, we are a direct lender in the U.S. So we have our own loan programs and we are underwriting and funding the transactions. However, we also do realize that we are dealing with sometimes very complex transactions or transactions that are beyond our ability to fund. And for that case, we are also a broker. So that allows us to do everything from residential to commercial transactions. So I think that’s it. Thomas, again, thank you very much.

01:14:23
Thomas Carden
Thank you very much.

01:14:25
Robert Chadwick
I don’t know if you have any final. .

01:14:28
Thomas Carden
I just actually want to say one thing and give you guys a compliment. American mortgages, I’ve been doing the expat tax business for a lot of years and prior to you guys coming on stream and really focusing on this area, getting a mortgage when you are overseas on anything as an American citizen was just a minefield of paperwork. I would have to go to the embassy, get things certified that I signed on for the clients, provide millions of documents that seemingly made no sense whatsoever and half the time they were being turned down. With American mortgages, if you’re overseas, has done a great service to people who want to invest in the U.S. and rental property. Do not underestimate how valuable the services that these guys are doing to this.

01:15:12
Thomas Carden
And I when they called and started talking to me a couple years ago now it was immediately how valuable that they were going to be for my clients. So you know, while they help refer a lot of your clients to us, we also send a lot of clients to America Mortgages too. And truthfully, as I said, I’ve been looking at property in the rental property in the United States and I’m obviously not going to go to anybody else in America Mortgages. It’s a great service and it will really help you build your wealth over time.

01:15:41
Robert Chadwick
Thomas, thank you very much. That’s very kind of you to say. And again, it’s the same as we feel dealing with American International Tax Advisers as well. So with that, thank you everybody for joining. I really appreciate your time and Thomas’s time as well. As always, we try to do these webinars at least twice a month and if you have questions, you can go on to the chat and you can make an appointment with both Thomas or one of our loan officers. So again, thank you very much. We appreciate everybody. Appreciate your time. Thank you.

01:16:18
Thomas Carden
Thank you.

01:16:19
Robert Chadwick
Thanks, Thomas.

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Disclaimer: This transcript is AI-generated, so kindly pardon any transcription or grammatical errors that may be present.