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#1 Motor31

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Posted 09 December 2013 - 02:18 PM

Hi all. I followed a couple of older threads regarding fianancing. We are trying to trade the current rig for a new one. Unfortunately we have run into a reinforced concrete barrier with financing. It seems that the term "Montana LLC" is a death sentence, immediately applied, no parole no second chance to any question regarding an RV loan, no matter what your credit history is. 

 

Here is my question, has anyone found a lender to not be that way? So far even Essex toes that line. I'm waiting on a return call from Alliant now, the rep is out of the office.

 

New note, even Alliant won't talk to us. Starting to look like we will be former RVers and really pissed off ones to boot.


Edited by Motor31, 09 December 2013 - 02:39 PM.

Mike, Nancy and the fuzzies.
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#2 sandsys

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Posted 09 December 2013 - 02:54 PM

Ah, you've discovered one of the downsides of LLC. To many it means no way to recover our money if you default. Have you considered disbanding the LLC and just becoming RVers?

 

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#3 wa_desert_rat

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Posted 09 December 2013 - 02:58 PM

Ah, you've discovered one of the downsides of LLC. To many it means no way to recover our money if you default. Have you considered disbanding the LLC and just becoming RVers?

 

Linda Sand

That has to be their concern but it's a little surprising. When I had our Corporation (S-Corp) we could get bank loans even for vehicles; but we had to personally co-sign. An S-Corp is not the same as an LLC but I would have thought that the same restrictions would apply. I wonder why they can't simply have an officer of the LLC personally guarantee the loan.

 

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#4 Stanley P. Miller

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Posted 09 December 2013 - 04:00 PM

Too much hassle and too much risk for a lot of lenders, there are safer places to lend out your money.


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#5 Motor31

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Posted 09 December 2013 - 06:26 PM

No more hassle or risk than anyone else with good credit.


Mike, Nancy and the fuzzies.
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#6 Kirk

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Posted 09 December 2013 - 09:15 PM

No more hassle or risk than anyone else with good credit.

If the lender has more customers than funds available for loan, they write the rules and accept only customers who are willing to comply with them. If there is significant funds available which nobody is in any hurry to borrow, then you might convince the lender. 

Starting to look like we will be former RVers and really pissed off ones to boot.

There must be an alternative to the use of an LLC?


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#7 Motor31

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Posted 09 December 2013 - 10:33 PM

If I had deep pockets, yup there would be an alternative to the LLC. We started out early on our dream because cancer in 98 told us we did not have the option to wait for someday and were financially more set to retire.  

 

Dropping the LLC means having to get a different tow vehicle. We could buy 5th wheel or we could buy a pick up, since the real capable PU's cost about the same, figure 60 to 70k and up. One won't be able to work without the other. I'd also have to drop the motorcycle and I've had one since 75. I even made my living on one before an onduty crash cost me my career. The HDT carries the bike without any problems. 

 

The taxes as well as other costs related to the change would prohibit any travel, so no Kirk an alternative isn't likely to be available.


Mike, Nancy and the fuzzies.
Fulltiming since 6/04
2005 Mobile Suites 38RL3 5er - resistin'
2000 Volvo 660 motorhome toter - pullin'
2010 Honda Gold Wing piggyback - ridin'
2007 Saturn Ion - pushin'

#8 Kirk

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Posted 10 December 2013 - 07:17 AM

The taxes as well as other costs related to the change would prohibit any travel, so no Kirk an alternative isn't likely to be available.

None of us know your circumstances, but there must be a way. I am very well aware of the costs of trading as we downsized not all that long ago and we settled for much less RV than we would have preferred because of current prices, versus our budget. Even so the RV lifestyle is too much a part of us to let it go and not find a way. Perhaps there might even be some alternative to trading RVs.

 

What surprises me is that nobody who has an RV registered via an LLC has responded as I have known several people to use them when registering new RVs and some of them must be financed? Whoever set up your current one might know of a lender who will work with you, if you have not asked them.


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#9 whj

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Posted 10 December 2013 - 10:08 AM

We looked at the MT LLC a few years back when we were buying our RV. We desided not to go that way because we felt that what we would be doing was

avoiding taxes. I recently read on an other RV forum that a number of states have gone after people who have used the LLC to avoid paying taxes on their RVs. The states that were mentioned were IA, MN, WI and MA. While many maintain the the LLC thing is legal, those states don't think so? Good Luck



#10 Jack Mayer

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Posted 10 December 2013 - 10:15 AM

Mike, why would dropping the LLC require a new tow vehicle? You can easily insure the truck without an issue, and you can be a resident of Montana if you like without the LLC - or switch to SD or TX. Both without an issue with the truck. FL - no, that would be a truck "issue". So I'm missing something on the truck issue.


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#11 Motor31

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Posted 10 December 2013 - 12:03 PM

Kirk,

Did ask the atty for the LLC about that, he had one lender he knew of but they don't do full timers. Must own a stick home.

 

Yup you are right. I too am surprised that the folks who were successfull recently have not chimed in. Perhaps they all still had stick homes so they were not technically fulltimers. I had actually hoped to get some constructive ideas about a lender. We worked all our lives, have great credit, no bills other than RV loan about to be paid off early, credit cards zero balance and no bad credit history at all. Yet no one even wanted to have us fill out the application to check. I could understand it if we were deadbeats, but then we would probably be able to get funding......

 

Whj, don't confuse avoiding taxes with evading taxes. Avoiding taxes is perfectly legal, you just do not put yourself into the position of owing them. Evading taxes is not legal. That is why folks who were not full timers and violated the tourist duration of stay laws in the state they were a resident of ran afoul of the tax situation. Full timers who like us, do not stay in one place more than a little while can do this, but those who really live in one state then try to skirt their states registration laws while maintaining the vehicle titled in another state get in trouble. We are legal AZ residents yet do not live in nor own property there, just winter visitors. Legal according to the laws and tax codes of AZ. The vehicles are allowed in the state a max of 180 days per calandar year, unless you LIVE here. We never stay longer than it takes to get clear of Dr and dentist duties for the year. After having been born, raised and lived here for 50 years, the thrill with AZ has worn off. That is why using the services of an attorney versed in the LLC situation as well as a tax advisor (CPA for us) is a good idea BEFORE you do something like this. We did so, learned what the "rules of the game" were and followed them. Otherwise it would have been a no go from the start and we would never had been on the road at all.

 

Mark, the insurance is based on both trailer and truck combination. The last 3 providers over the last 8 years have all specified that condition. They also said they had to be registered in the same state to avoid issues with insurance requirements and so on. I could understand their position on that given it would be a paperwork hassle to deal with differing states requirements in the case of a claim involving both vehicles.

 

At this point switching to TX, SD (as a truck rather than Mtr home) or possibly Wyoming is looking like the last gasp for our dream. I have to check to see how the additional costs would add up. So far I lack a lot of info about it.


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2005 Mobile Suites 38RL3 5er - resistin'
2000 Volvo 660 motorhome toter - pullin'
2010 Honda Gold Wing piggyback - ridin'
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#12 BooneDocks

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Posted 10 December 2013 - 12:29 PM

I would think the Bennett Law Firm in Missoula, Montana, the preeminent arranger of Montana LLCs would be able to guide you to a lender if there is one.

 

http://www.bennettlawofficepc.com/


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#13 Motor31

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Posted 10 December 2013 - 12:31 PM

BooneDocks, that's who I use.


Mike, Nancy and the fuzzies.
Fulltiming since 6/04
2005 Mobile Suites 38RL3 5er - resistin'
2000 Volvo 660 motorhome toter - pullin'
2010 Honda Gold Wing piggyback - ridin'
2007 Saturn Ion - pushin'

#14 Kirk

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Posted 10 December 2013 - 04:53 PM

I recently read on an other RV forum that a number of states have gone after people who have used the LLC to avoid paying taxes on their RVs. The states that were mentioned were IA, MN, WI and MA. While many maintain the the LLC thing is legal, those states don't think so? Good Luck

You are probably thinking of the stories of those who live and work in a state but try to hide the big RV from local taxes by doing the MT, LLC thing. If you were to talk with the firm Motor uses you would find that they advise against that sort of thing and even steer some fulltimers away for various reasons. When I talked with them they advised me not to go that route because the savings would not justify the work and cost involved in setting one up.

 

There are two states that I know of which have prosecuted a resident for criminal tax fraud over a Montanna LLC. The two are Colorado and California, and both cases were published in the media. I am sure that there have been other cases. Generally the way that they get caught is by parking the RV at their homes for storage when not in use. Fulltimers have much less problem there because they don't store the RV in the home state.


Good travelin !...............Kirk

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#15 PETE & PAT

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Posted 10 December 2013 - 07:30 PM

One of your problems may be that you have a 0 balance on your credit cards and no mortgage, no car loans etc.  Insurance companies now use credit as part of the determining factor of rates (I hate it too), and when we were trained, we were told that someone like you would pay higher rates because you would be considered to have an "incomplete" credit history.   It's not how it should be, but by having everything but you rv paid for you really are not "active" for a credit rating.   As explained to us, the banks want to see someone who actively uses their credit and manages their payments.  Perhaps a lack of debt is affecting you also.  Just passing on what I had previously learned.

 

Don't know about a credit union, but we had no problem financing a 10 year old class A for a small amount with a credit union.  All the others said - too old - not borrowing enough and would not do the finance.  Maybe try a credit union???


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#16 DaveM

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Posted 11 December 2013 - 09:18 AM

Ok so if I have credit cards that I charge on monthly and I pay them in full every month does that mean there is no credit rating for that or a lower rating? If that's the case then I need to pay interest on cards in order to get the rating? I pay in full every month. I sure hope that don't make me a dead beat...lol

 

Just curious.

 

Dave


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#17 Jack Mayer

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Posted 11 December 2013 - 10:04 AM

Dave, that will potentially give you a poorer credit rating than someone who carries a high balance and makes payments every month. You are demonstrating less "ability" to manage money.


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#18 road king

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Posted 11 December 2013 - 10:36 AM

People who pay off their credit cards every month are considered "dead beats" as the bank makes no money off of them in interest rates. And it does affect your credit rating.

#19 Cathy & Jim

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Posted 11 December 2013 - 11:16 AM

I never carry a balance on any credit cards to the next month, have no loans, don't own a home, and still manage to maintain a credit score better than 95% of Americans that Experian (spell?) rates. I do use my credit cards a lot. Perhaps 30% of my total monthly expenses are charged to plastic. I probably have 20 cards including all the department store cards, but use my no fee Fidelity American Express card for most my purchases because it gives back a full 2% on all purchases. I will use a few other cards when I can get a better statement credit or a good purchase discount.
In the past I have demonstrated being able to pay off loans.

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#20 Motor31

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Posted 11 December 2013 - 12:01 PM

Pet and Pat, that can't be the issue since not one of the lenders would even extend an application much less run a credit check. They simple said they would not consider the loan, period.

 

Credit card banks are making money off of every purchase you make. They do not have to rely on the interest frm the borrower. They get an immediate percentage of each and every purcse in the guise of fees to the seller. The same thing applies to those debit cards, including the ones that do not charge fees to the folks who use them. The banks charge fees for every swipe purchase or if you use it as a credit card for that use as well.

 

TAANSTAFL applies in the banking world. Note that not one of the CEO's or branch managers of a bank are on food stamps.


Mike, Nancy and the fuzzies.
Fulltiming since 6/04
2005 Mobile Suites 38RL3 5er - resistin'
2000 Volvo 660 motorhome toter - pullin'
2010 Honda Gold Wing piggyback - ridin'
2007 Saturn Ion - pushin'