Posted by cork horner on March 07, 2010 at 20:03:16:
yes.
That’s funny, Charles. --hum and count.
c h
Creating Paper - Posted by Charles Parrish
Posted by Charles Parrish on March 05, 2010 at 08:56:28:
Creating Paper
- Find the cash needed by creating a low interest note secured by a property you own. Use the note as a down payment on the property you wish to purchase, or sell it to an investor for cash.
Your title company can draft the mortgage and note without an appraisal.
Include a substitution of collateral clause so you have the option to move the debt to another property, a subordination clause to secure 1st position financing, and reserve a pre-payment discount.
If you do not have a property to use this technique, find someone who does, JV with them. This is a great way to leverage transactions.
Charles Parrish
Re: Creating Paper - Posted by Bob Smith
Posted by Bob Smith on March 05, 2010 at 18:38:42:
Don’t forget a right of first refusal clause, so if they sell the note you
can match the offer and pay off at a discount.
One JV technique I like is to wrap the mortgage you’re giving as down
payment. For example, you create two notes & mortgages, one $20k
at 6%, the wrap $20k at 8%. You give the 6% one to the seller, the 8%
one to your JV partner/collateral owner. Their free 2% spread on their
dead equity is your cost for using their collateral.
Great use of notes today - Posted by John Merchant
Posted by John Merchant on March 05, 2010 at 12:18:46:
Note selling, for cash, w/o horrendous discounts, has become so difficult and tedious that using them for wampum is far and away the best way to use them today.
The magic key, of course, is to find that property seller who’s really motivated to move that property so he/she’ll consider taking all kinds of things as down payment or part of it.
You’re preaching to the choir… - Posted by Rick, the Probate Guy
Posted by Rick, the Probate Guy on March 05, 2010 at 12:33:13:
I agree with you, John. Find a motivated seller and they’ll take most anything that they perceive value in.
My friend is a well-known investor in the Palm Springs, CA area and tells the story of requiring sellers, in certain deals, to accept his motorhome in part trade. It works fine; no issues there.
Of course later, when he delivers it, proves it’s solid and reliable, the sellers tell him thanks but he can keep it.
Maybe because it’s not so pretty?
Re: You’re preaching to the choir… - Posted by John Merchant
Posted by John Merchant on March 05, 2010 at 12:54:12:
Used to be a story going around Comm’l RE Agents groups about a box of “antique currency” that just kept being passed around when a little something more was needed to make a deal…supposedly it’d been moved around for something like 20 years w/o ever being opened ;).
Probably nobody willing to see if there was anything there, or if so, what is was.
I, myself have taken “lake lots” that turned out to be not w/i 25 miles of any lake, but they were smaller “eaters” than the apts I was dumping.
Re: You’re preaching to the choir… - Posted by charles parrish
Posted by charles parrish on March 05, 2010 at 18:25:20:
It is good to hear from creative real estate
professionals. John, what you are talking about is
called “currency land”, usually worthless, but good to
balance an exchange.
Working with 1031’s can make an investor rich.
There are so many techniques and models out there that
are creative and very effective in putting together
deals.
I have about 120 techniques that I have written down as
a reminder, I put them in a pocket pack, like flash
cards that I always, even now at 68 years old, look at
to remind me of different techniques to close a deal.
Just today, I was trying to buy a 45,000 s.f. warehouse
in Baltimore. I looked at my cards and suggested a
split take back notes concept and a vertical break up
concept to close the deal.
Good luck,
Charles Parrish
Re: You’re preaching to the choir… - Posted by cork horner
Posted by cork horner on March 07, 2010 at 13:46:00:
Charles; I remember your ‘humming lesson’ in LV. Hilarious! Remember?
I haven’t tuned into your telecalls lately.
Does everybody here know you are prob the primo auctioneer?
Hummmmmmmmmmmmmmm,
c h
Re: You’re preaching to the choir… - Posted by charles parrish
Posted by charles parrish on March 07, 2010 at 20:00:36:
Yes, we had a good time in LV. I hope you picked up some
investing ideas. I am still teaching others how to hum
and count at the same time.
Charles