Why Investing Right Before Tax Refund Season Can Give You An Advantage

This can be one of the best times of the year to acquire new real estate assets. Even more so if you are risk averse and prefer shorter investment cycles. Here’s why…

According to Business Insider and UBS Analysts, taxpayers are expected to receive even more dollars in tax refunds this spring. Totals are estimated to be as high as $66B this 2019 tax season.

Of course, there have been a few more complications in filing federal income tax returns this year. Sweeping new changes have made filing this year far more complex. Both employers and workers are working on dancing with these new rules and what they mean. So are tax preparers. Then there is the recent government shutdown which could have backed things up even further. On the bright side, that gives quick acting investors a small extension on this window to take advantage of acquisition opportunities.

For Mortgage Note Investors

While tax refund season often mostly spurs frivolous and wasteful spending by those who have loaned their money to the government all year long and now feel like they have won the lottery, many will also use the opportunity to catch up on bills.

If you’ve got $3,000 in your hand, and you can either save your home (and equity) by catching up your mortgage payments, or you can upgrade to yet another iPhone model, the house should win.

This makes it a great time for mortgage note investors who have acquired non-performing assets. It’s far more likely borrowers will bring loans current in the next couple of months. That’s good if you hope to collect cash flow, or to flip the note.

It may not sound as good to those who hoped to foreclose on the underlying collateral though. Nevertheless, negotiations are still open, and perhaps this is the best chance the borrower has to go find new housing and start over again.

For Buy & Hold Investors

Tax refund season brings even more chance that renters will stay on top of rent or bring accounts current. That’s not only welcome news if you are a landlord with slow paying tenants. It’s also an opportunity to acquire underperforming rental properties and quickly turn them to positive cash flow.

For Flippers & Rehabbers

The same applies to flippers. For eager home buyers, this may be their one chance this year to have some kind of down payment. At the same time, other investors are using this last minute window to restructure portfolios and use SDIRA contributions to save on taxes.

How will you make your moves?

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

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