Frequently Asked Questions

How do I use a 1031 tax deferred exchange to get an interest free loan from the government?

The government has developed a method to let you use the taxes you owe on the sale of a property to buy more property.  It is the 1031 tax deferred exchange.  They will let you continue to use the tax money you owe as long as you keep it in investment real estate.  When you sell a property you will owe (assuming it has appreciated) federal capital gains tax on any gain you realize.  Depending on what State the property is located you may also owe a State tax on the gain.  All of the tax obligation can be deferred, essentially throughout your lifetime, as long as you continue to keep it invested in real estate, thereby effectively getting an interest free loan from the government.  Click here for more details (courtesy of IPX Exchange) or contact the 1031 tax deferred exchange experts at MVP COMMERCIAL.

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Where can I find a loan?

MVP COMMERCIAL will analyze your situation and direct you to a lender(s) who can handle your transaction as efficiently and economically as possible.  You may need a conventional loan, a loan with a SBA guarantee, mezzanine (bridge) financing, an equity partner(s), cross collateralization, seller carry-back or some combination of the above. MVP COMMERCIAL also has sources for construction financing and participation lending.

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Why should I use a Broker?

Your job is owning and running a hotel or hotels.  Our job is assisting in buying and selling hotels.  Yours is a full time job and so is ours.  We have the expertise to help you maximize your return on your investment.  We screen the market and present you with the best alternatives.  We structure exchanges, locate financing, find equity, place ads, send letters, show property, discover defects, analyze leases, obtain entitlements and negotiate deals.  We work for you.   

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What is site analysis?

Site analysis looks at a property and projects the costs and benefits of ownership.  If it is a vacant site demographics, demand generators, traffic flows, entitlement costs, labor pool, building costs and the competition is all used to develop projections and recommendations.  If it is an existing hotel, the flag, the marketing, the condition, the management and the overall market are used to develop recommendations.  The analysis may tell you not to do the deal you are contemplating or to restructure the deal to better position yourself and the property.

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What is a Broker Opinion of Value?

A Broker Opinion of Value will tell you the market value of your property, assuming a willing seller and buyer.  It may suffice in some tax audits, settlements, probates and situations where a certified appraisal is not required.  It will give you an analysis of the property with recommendations on maximizing the value.

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What are the benefits of different ownership vehicles?

Sole proprietorship, tenants in common, limited and general partnerships, LLCs, Sub-S corporations, C corporations and other ownership vehicles all have certain advantages and disadvantages.  Depending on your situation and the State the differences must be understood before taking title to a property.  We work closely with local attorneys to help you decide the best vehicle for your situation.  

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What should I look for in analyzing a hotel to purchase?

Location is always paramount, however competition, exposure, land costs, building condition and changing demographics all impact the decision.  Click here for a good article by Stephen Rushmore on hotel analysis.

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