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Just Bought a Commercial Building using a TIC (Tenants in Common)

By Audrey James

Mortgage and Lending with CARTERET MORTGAGE CORPORATION

July 29, 2007 03:23 AM

WOW, I DID IT!

I just closed escrow on this commercial building in Dallas, Texas. What a wonderful feeling. I did what you call a TIC. No more calls in the middle of the night from tenants, termites, trash, toilets, etc.

In order to do a TIC, you must be accredited. By that I mean, a net worth of $1 million dollars. Since single family resident home values are hurting and the numbers didn't make since to rent out my SRF again, I sold it. This was a MUCH better choice. I have a great souce, AND RETURN ON INVESTMENT, if anyone needs to know. The company was great to work with and walked me through everything to get my very first TIC.

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BILL CHERRY

Bill Cherry, Realtor - Dallas, TX

Broker & Wealth Coach

Audry, I must have been asleep for a few years. Help me out. You apparently sold your residential property and bought this commercial building in Dallas. You are a tenant in common with one or more others? And there is some requirement that each of you have a net worth of a million bucks or more in order to take title as tenants in common?

Whose rule is that? Does it just pertain to real estate investments on which there is borrowed money?

Jul 29, 2007 03:47 AM

Audrey James

CARTERET MORTGAGE CORPORATION - Oakland, CA

Senior Loan Officer

Hi Bill,

I have a couple of rental properties, single family residents. Accredited means they take the equity in the property, cash, cars, savings, everything to get a asset value. I am an investors with others; up to 35 investors only. Each must have a million bucks or more in order to take title in a LLC as tenants in common. I will sale another SFR and buy another TIC with the equity using a 1031 exchange. It pertains to real estate or it you are rich and have lots of liquid cash. I don't. :) There are FREE seminars if you need help. This is how I found out about it. Wish I knew about it years ago.

Jul 29, 2007 03:58 AM

David A. Podgursky PA

THE PODGURSKY GROUP @ Re/Max Direct - Boynton Beach, FL

THE PODGURSKY GROUP - Make the Right Move!

I don't think it is help he needs

TIC is a classification of ownership

and you didn't explain how it works

you bought a SHARE of a building... you are ONE of the Tenants in Common

you didn't mention that you 1031'd the property - and that 1031ing a residential property can be tricky because if you ever lived in it, it may be disqualified

then instead of buying another residential property, you bought INTO a building

you can do a TIC without $1M... the contract would state what you need. You can TIC with friends on a small investment too. TIC is just the rights you have as an owner and how they effect the other owners. TIC allows you to sell your portion and has certain advantages for investors over joint tenancy - like survivorship and saleability

Jul 29, 2007 04:09 AM

Thanks for giving more clarification David. It would be best for anyone who is interested in a TIC to attend one of the free seminars to get the facts as I mentioned. The TIC transaction I did, you have to be accredited. Sure you can buy with friends, but that is not how I purchased. I won't explain the details because I don't fully understand all the legalities of the TIC. In my above response I mentioned I bought using a 1031 exchange. There are strict rules with a 1031 exchange. The Companies or brokers that participate in TIC's will have a one-on-one meeting to go over your financials with you.

Jul 29, 2007 05:20 PM

Just Bought a Commercial Building using a TIC (Tenants in Common)

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