View Full Version : Qualification ?
greatholiday
02-02-2004, 18:36
Hi
I know that I really need to speak with an expert on this, but there seems to be a great wealth of knowledge on here, so let's give it a go :-
My wife and I are in mid-30s, no kids.
We have a new business in the UK (established 2003), which is internet based and could be moved to the US without problems for us - at present the income is only $35,000 USD annually (but expected to increase sharply in 2005).
We want to buy 4 properties in Florida - the first to live in (no mortgage) and another 3 to rent out (with only 30% mortgages on each of the 3 properties).
We shall be doing all of the management of the properties ourselves.
Our estimated nett income from the rentals would be a total of $25,000 USD annually (is this reasonable? c$8000 each?)
This would provide an income of $55,000 USD, whilst still owning 1 property and paying off the small mortgages on the others.
Now, what opinions do you have on this regarding qualification for residential status in the US ?
Your advice is very much appreciated.
Thanks
Paul
chrizzy100
02-02-2004, 21:16
quote:Originally posted by greatholiday
Hi
I know that I really need to speak with an expert on this, but there seems to be a great wealth of knowledge on here, so let's give it a go :-
My wife and I are in mid-30s, no kids.
We have a new business in the UK (established 2003), which is internet based and could be moved to the US without problems for us - at present the income is only $35,000 USD annually (but expected to increase sharply in 2005).
We want to buy 4 properties in Florida - the first to live in (no mortgage) and another 3 to rent out (with only 30% mortgages on each of the 3 properties).
We shall be doing all of the management of the properties ourselves.
Our estimated nett income from the rentals would be a total of $25,000 USD annually (is this reasonable? c$8000 each?)
This would provide an income of $55,000 USD, whilst still owning 1 property and paying off the small mortgages on the others.
Now, what opinions do you have on this regarding qualification for residential status in the US ?
Your advice is very much appreciated.
Thanks
Paul
I don't think owning and renting would give you the kind of income you would need to live here full time......and from what I've read the USA will not give you a visa just because you own and rent homes.....its income that could dry up to easy.....most people make very little profit on their rental homes.....they do it out of love of the area......if you owned the homes outright....and did all the management yourself.......you could see a bit of profit..but from what I've read on this forum I would only count on having the homes rented out for around 20-30 weeks per year each....I'm not even going down the rental path with my FL home.....I've learnt so much about the pitfalls from the good people here....I'm just keeping my home empty ..you'd be better off buying repo's doing them up and selling......but thats not going to get you a visa.......living in the USA is no bed of roses...its hard work......the Americans are the hardest working people on earth.....but saying that.....you work hard enough and America can give you things you never thought you'd have.....I'm sure you'll get tons of good info.....good luck.......[msnsmile2]
florida4sun
03-02-2004, 02:53
Owning oroperty in Florida gives you no status for a green card or living here.
You could would not be able to do an L1 as you ahve to have the existing business running in the UK. The other option is a E visa which you would be required to make a considerable investment into a business that is employing 2 or more US citizens.
You really need to talk with a qualified attorney about this. From what info your are giving I dont think it would work for you.
quote:Originally posted by greatholiday
Hi
I know that I really need to speak with an expert on this, but there seems to be a great wealth of knowledge on here, so let's give it a go :-
My wife and I are in mid-30s, no kids.
We have a new business in the UK (established 2003), which is internet based and could be moved to the US without problems for us - at present the income is only $35,000 USD annually (but expected to increase sharply in 2005).
We want to buy 4 properties in Florida - the first to live in (no mortgage) and another 3 to rent out (with only 30% mortgages on each of the 3 properties).
We shall be doing all of the management of the properties ourselves.
Our estimated nett income from the rentals would be a total of $25,000 USD annually (is this reasonable? c$8000 each?)
This would provide an income of $55,000 USD, whilst still owning 1 property and paying off the small mortgages on the others.
Now, what opinions do you have on this regarding qualification for residential status in the US ?
Your advice is very much appreciated.
Thanks
Paul
greatholiday
03-02-2004, 21:08
Hi Both
Thanks for your replies.
Given that we have an income from our internet-based business of c$35k - would this count as a qualifying business in itself?
Although it only provides work for one at present, we anticipate that by the time we get through the many questions we have, the income will be at least c$70k
Would we be regarded any differently if we had one property owned outright and c$350k in cash sat in the bank - not exactly rich, but certainly not at "scrounger level" either.
Having just sold our retail convenience store businesses in the UK, we certainly don't fancy buying another retail business just to qualify for US residency, although we wouldn't rule out another business opportunity.
Again, I know that ultimately we need specialist advice, but it also helps to get a feel for things before moving to that stage.
Of course, the way things seem to be going, any specialist advice this week could be outdated by next week.
Thanks
quote:not exactly rich, but certainly not at "scrounger level" either The USA doesn't generally have any 'scroungers' at all as UK non-resident aliens (what you're called if you have an E visa and a US business) are entitled to absolutely nothing at all in the way of benefits.
It doesn't matter how much money you have 'in the bank' so to speak as US Immigration is usually only interested in how much money you're going to 'invest', how many people who are US nationals you're going to employ and that this provides enough income to live on and support yourself.
The whole theory behind the E visas is that you need to make a 'significant' investment in a US based company so I don't think an existing business would actually count towards that. You also, as has already been said, need to employ US nationals in any business.
I think you need to run your thoughts past a good immigration attorney to see what they suggest. In the meantime, have a look at the US Embassy website at http://www.usembassy.org.uk/cons_web/visa/niv/e.htm
YOur UK business doenst make enough for L1. They are looking for something substantial with employees. Buying property does not qualify for E2. It has to be a real business emloying Americans. It also has to be making an owner benefit of $60.000 pa. You have to make a substantial active investment in the US economy. Investing in propety to rent out and manage yourselves is seen as passive investment. We could have done just what you wish to do but we had to fork out and buy a real business. There is no way I can see around this, Sorry, but there it is.
greatholiday
04-02-2004, 13:39
Hi Folks
Thanks for the educated feedback.
I told you that I could save a lot of time at the outset by simply asking your advice - Thanks!
What are peoples views on buying qualifying ready-made businesses in the US ?
I did read that the best route was to find a business where the current owner would defer part of the selling price - meaning that HE believed that the business was in fact viable and was prepared to wait for payment.
Rather than the business being just a scam for unsuspecting would-be-residents who will buy anything in order to try and stay.
So, the question being :
Should I aim to buy outright or aim to buy "in installments" ?
I turn to your experienced views once again.
Thanks
Paul
There are good and bad businesses. One of the problems is that most contracts here are 30 days notice. So you buy a business with contracts on closing but there is no certainty they will stay around. Sometimes, the customers just dont like "being sold on". So you have to be careful.
You mean owner financing. We took this initially. It turned out to be secured and at 9% with swinging penalties if you were a couple of days late in paying. We paid it off. Owner finacning doesnt guarantee your business will succeeed just that you will lose it totally if you are struggling. I dont think you will get unsceured owner financing.
greatholiday
04-02-2004, 19:53
Hi Esprit
Thanks for the feedback.
The benefit of Owner Financing is that we could buy a $350k business, invest $200k upfront and leave our remaining $150k cash in the bank.
This would mean the money is still there to pay the debt but we would feel more secure because the owner has confidence in his/her business being able to meet the final payment bills etc.
We could still buy a property outright.
Thanks
Paul
Getting 1% interest in the bank and paying around 9% for owner financing, hmmm......
greatholiday
05-02-2004, 12:59
Hi esprit
Sorry - my mistake.
I misread your previous answer as being penalties at 9% and not the debt being financed at 9% (plus the penalties).
However, it may still make sense to go for this type of business purchase (ie half now / half later) as it does show the continued faith of the seller in his/her business being able to meet the repayments.
Once we settled on a business being sold in this way, we could simply pay the full amount at purchase anyway.
Hope that makes sense ?
Thanks
Paul
chrizzy100
05-02-2004, 17:59
quote:Originally posted by greatholiday
Hi esprit
Sorry - my mistake.
I misread your previous answer as being penalties at 9% and not the debt being financed at 9% (plus the penalties).
However, it may still make sense to go for this type of business purchase (ie half now / half later) as it does show the continued faith of the seller in his/her business being able to meet the repayments.
Once we settled on a business being sold in this way, we could simply pay the full amount at purchase anyway.
Hope that makes sense ?
Thanks
Paul
The other thing I think both me and Julie have said in the past is.......think of the amount you'd need to get you through the first 3 years........and then double it........a lot of everyday things like lighting.. cooling... water and food costs etc are a lot more in the USA......when I got my first gas bill I thought it was for the year not the month........the cheap patrol in no way makes up for the extra everyday cost in running a home......
florida4sun
05-02-2004, 22:53
Problem you have is that they do not like to see any more than a 10% loan for E visa's. You need to show the you are financially secure and having a large loan on a business is not, its a liability. I doubt if you will find many who will fund more than that anyway. What is to say you dont mess up the business and go bankrupt!
The only way is L or e visas, you can do these by investing in porperty but you have to part with around $1 million and they are not easy visas to get.
quote:Originally posted by greatholiday
Hi esprit
Sorry - my mistake.
I misread your previous answer as being penalties at 9% and not the debt being financed at 9% (plus the penalties).
However, it may still make sense to go for this type of business purchase (ie half now / half later) as it does show the continued faith of the seller in his/her business being able to meet the repayments.
Once we settled on a business being sold in this way, we could simply pay the full amount at purchase anyway.
Hope that makes sense ?
Thanks
Paul
My attorney said 20% financing was OK for E2. I dont see how the owner financing helps you. It will be on promissory note secured on the business. If you dont pay, the ex owner takes his business back. I dont see how this would keep him on the straight and narrow.
There is little you can really do to safeguard yourself against bad businesses. Even businesses which are good at closing and appear good can turn bad in six months. This may not be anything the ex owner has any control over. But he will still want his installments and will be ready to impose penalties or foreclose if you are late paying or dont pay. E2 is a risky visa, there is no two ways about it.
The other thing I would say is I noted your user name is greatholiday. I can honestly say that running a business here is nothing like a holiday, great or otherwise. It is Hard. Hundreds give up and go home each year I personally would not buy something large. I would buy a business as small and cheap as possible which is still eligible for the visa, then network when you get here. That way you dont have so much to lose.
greatholiday
06-02-2004, 17:03
Hi All
I am really struggling to understand some of the comments on this site !
Firstly, let me say loud and clear - I TOTALLY accept that it is VERY difficult to get in to the US and EVEN MORE DIFFICULT to survive with a good lifestyle.
However, I am beginning to worry that some of the posters on this site (not just this thread) have got a TOTAL LACK OF AMBITION and/or MOTIVATION.
Have any of the people posting on this site EVER replied to anyone with comments along the lines of : "I think you have got what it takes to succeed in the US" - whether this being financially or otherwise ?
EVERY comment I have read is negative.
Now, again, I fully accept that there are plenty of people who can't make it in the UK who suddenly think they can become millionaires in the US - but there are others (hopefully with sufficient cash reserves) who are looking for some (any) sort of encouragement that the move could work for them.
I have stated my own situation a few times - I have c$500,000 in cash.
This is intended to purchase a home (no mortgage).
It is also intended to buy a business c$350,000 cash (again no loans).
My only comment is that I would personally feel safer buying a business where the owner is prepared to wait for his cash. It shows that he has faith in the business. It DOESN'T mean that I would take a loan to pay the owner later - I would actually pay the full amount on completion.
An example :
Business A for sale at $350,000 - you buy it in cash and it "could" be useless.
Business B for sale at $350,000 - the owner offers to take $200k now and $150k in a year.
Again it could be useless, but if you can't keep up with the payments, what does the owner get back - an even more useless business that he has got to try and sell again. In the meantime he is down by $150k.
Now, in my experience, it would show that Business B is the best bet. The owner IS taking a gamble on your success.
It is just that I have suggested looking for a Business B type purchase - but simply pay the full amount on completion.
I do hope that the aabove makes it clearer.
Thanks
Paul
PS
PLEASE try to show a little encouragement in your replies to people, whilst providing the facts.
PPS
Greatholiday is part of the e-mail address I use to deal with rentals on our Spanish property - I use it for all message boards too - it is not intended to be an indication of my dreams.
Basically what you are wanting to do is go to Florida and set up your own mini MC, with your own homes and run an internet business with a small profit from the UK. The income from these businesses will not be enough to get you into the country on either an L or E visa.
Since 9/11 the US authorities have been turning down applications in their droves, from people who want to own and run an MC in Florida. Speak to a good immigration lawyer, but don't be surprised when you get very much the same "negative" replies. Come up with a good business, or buy one, not related to rental property, that is already successful, and then it could well be a different story.
Don't shoot the messengers, just because you didn't want to hear the message.
What Julie said earlier was that, even if you find a business with an owner willing to accept instalment payments, there's no way that you can get out of payment of the later instalments as you'll have signed the contract to take over the business with your first payment and also have a legally binding contract to make the remaining payments. The business owner is not taking any risks on the business turning out to be successful at all - you sign the contract, you are committed to pay in full for the business. Costs for taking legal action against anyone in the USA are prohibitive if the business doesn't work out for any reason. I don't see that as being negative, just telling you the facts of the situation you're proposing. I think that's the information that you asked for?
The negativity that you mention is probably due to the fact that both Martin and Julie have been through this process and know how much time it can take and how difficult it can be. Carla has mentioned 9/11 and this has undoubtedly had quite an influence on how much the difficulty has increased since then.
So, the question really is whether you can find such a business owner who will let you pay in instalments and also if you can gain a visa with this sort of business purchase plan.
The next step for you is presumably to run your ideas past an immigration attorney and we all wish you luck with this. Please let us know how you get on.
steph_goodrum
06-02-2004, 18:28
"Business A for sale at $350,000 - you buy it in cash and it "could" be useless.
Business B for sale at $350,000 - the owner offers to take $200k now and $150k in a year.
Again it could be useless, but if you can't keep up with the payments, what does the owner get back - an even more useless business that he has got to try and sell again. In the meantime he is down by $150k."
I can't think of any reason why the owner of business B would or should risk waiting for a year for payment from a stranger. He could have the most thriving business going but along comes a buyer who makes all the right noises but is absolutely useless at running a business and within 6 months has lost contracts (maybe through no fault of his own - just that some people like to choose who they do business with rather than be sold on as a commodity) or may have big expansion plans, invest too much money and not be able to follow through. There are any reasons why a business can fail and I for one certainly wouldn't want to risk waiting for my money which presumably would be needed for the sellers future plans as well. Nothing to do with not having faith in the business as it stands but more to do with having no control over the future success of the business. You are effectively asking them to invest $150K into a strangers business.
Greatholiday, Florida4sun, myself and Chrizzy have all been through the process and live here. We are not unmotivated or lacking in ambition, we would not have got here at all otherwise, we are just telling you like it is so you know the facts and take the rose coloured glaases off. I know I had them on when people told me the facts and I would not listen to them. If I had have, I would have done things differently. Forewarned is forearmed. That is all.
GH I think you will find people on this forum are giving you the benefit of their experience and knowledge. Perhaps you would be better talking to a specialist immigration attorney in this field and seeing what they have to say.
My limited understanding of the US system - bearing in mind they already have their quota of immigrants from the UK, is you can either buy a business that is viable as long as you employ some US nationals, you can invest $1M in a business, or you start a division of your existing business (which must still run profitably in the UK.
chrizzy100
06-02-2004, 18:49
quote:Originally posted by greatholiday
Hi All
I am really struggling to understand some of the comments on this site !
Firstly, let me say loud and clear - I TOTALLY accept that it is VERY difficult to get in to the US and EVEN MORE DIFFICULT to survive with a good lifestyle.
However, I am beginning to worry that some of the posters on this site (not just this thread) have got a TOTAL LACK OF AMBITION and/or MOTIVATION.
Have any of the people posting on this site EVER replied to anyone with comments along the lines of : "I think you have got what it takes to succeed in the US" - whether this being financially or otherwise ?
EVERY comment I have read is negative.
Now, again, I fully accept that there are plenty of people who can't make it in the UK who suddenly think they can become millionaires in the US - but there are others (hopefully with sufficient cash reserves) who are looking for some (any) sort of encouragement that the move could work for them.
I have stated my own situation a few times - I have c$500,000 in cash.
This is intended to purchase a home (no mortgage).
It is also intended to buy a business c$350,000 cash (again no loans).
My only comment is that I would personally feel safer buying a business where the owner is prepared to wait for his cash. It shows that he has faith in the business. It DOESN'T mean that I would take a loan to pay the owner later - I would actually pay the full amount on completion.
An example :
Business A for sale at $350,000 - you buy it in cash and it "could" be useless.
Business B for sale at $350,000 - the owner offers to take $200k now and $150k in a year.
Again it could be useless, but if you can't keep up with the payments, what does the owner get back - an even more useless business that he has got to try and sell again. In the meantime he is down by $150k.
Now, in my experience, it would show that Business B is the best bet. The owner IS taking a gamble on your success.
It is just that I have suggested looking for a Business B type purchase - but simply pay the full amount on completion.
I do hope that the aabove makes it clearer.
Thanks
Paul
PS
PLEASE try to show a little encouragement in your replies to people, whilst providing the facts.
PPS
Greatholiday is part of the e-mail address I use to deal with rentals on our Spanish property - I use it for all message boards too - it is not intended to be an indication of my dreams.
We all move to the USA thinking that life is going to be tons better here.....but I have to be honest...after the first few months....its no different than anywhere else.......you go to work ..you shop...your kids go to school.....if you're luck....like we have been.....America is a great place to live......but we know first hand how you can lose everything over night here......without anything to fall back on......I never felt any fear over the thought of my husband being out of work when back in England......but here its was a nightmare....and losing a Business of your own would be a double nightmare if you have no greencard.......lucky my husband was out of work for only 5 days.....he was taking back on by his company after a buyback......but even with money in the bank...we would only of been able to hold on to our house for a few months...we would of had no money for healthcare......I just can't tell you how it feels to think that your child would have to go sick.......at that time I never knew that Mass gives people free healthcare.....its one of the few States that does.......
People can make a great life over here......but you need to know all the bad things too.......all the pitfalls so you never fall into them.....
I must admit I have received some great advice and information from you guy's, especially from Julie and Blott.
But I do think that 'Greatholiday' as a point to make. Your advice does come across a bit negative. Please don't be affended.
Many, me for one value this site and the advice we receive. I mean would any of you come home tomorrow given the chance. Perhaps the odd 'GO FOR IT' would be an encouragement. I'm just saying it as I see it. sorry.
chrizzy100
07-02-2004, 00:19
quote:Originally posted by jimbo
I must admit I have received some great advice and information from you guy's, especially from Julie and Blott.
But I do think that 'Greatholiday' as a point to make. Your advice does come across a bit negative. Please don't be affended.
Many, me for one value this site and the advice we receive. I mean would any of you come home tomorrow given the chance. Perhaps the odd 'GO FOR IT' would be an encouragement. I'm just saying it as I see it. sorry.
No I would not go back to England now....I think I may do later.....(we nearly had to go home because of lack of work)..... but I for one would never say go for it to anyone unless I thought they had everything worked out already and were not at the start of looking into the move....not after living here...sorry and all that...I'd say talk to as many people as you can about moving here.....and then make up your own mind....
We will have to eventually. There is no retirement on E2 and we are of an age when in ten years we wont be able to do the sort of work we do here physically. Stop running the business and you are out. Our only hope is that our son will eventually get a green card, become a citizen and sponsor us so we can stop working. Will be 10 years mininum, maybe more.
Come home tomorrow??. Maybe not. Our life is here now, very difficult to move back. Not have come???? A different question. My husband does miss a lot about the UK, more than I do. But I suppose there would always have been that "what-if" in our minds. Time over again, exhaust every avenue before settling for an E. Even set up a business in the UK specifically to get an L - eventually. So much better a visa.