Help! - Posted by Greg

Posted by Bill Gatten on February 04, 2001 at 15:02:15:

  1. Tell your seller that he needn’t give you the title at all, that you’ll merely make all of his payments for a month or two and then pay off his loan.

  2. Place the property into a land trust (in his name, if that makes him feel more secure) with you as the trustee and only beneficiary (*or you can take only a partial beneficiary interest, along with an agreement from the seller that he?ll forfeit his beneficiary interest to you when the trust terminates and when his loan and/or any sums owed to him are paid in full). If you’re going to hold the property for more than a few months, then you might need to do it all via a PACTrust, but for a quick flip or refurb, that’s not always necessary.

  3. Next, as the trustee (with full power-of-sale), at the direction of the beneficiaries (you, and the former owner by means of an Assignment of Power-of-Direction) sell the property to a qualified buyer for enough to pay off the loan and line your pockets (or your pickup bed) with a few shekels.

Obviously doing it this way cuts down on paper work, avoids double escrows, by-passes seasoning requirements, avoids seller consternation (makes them feel a little warmer and fuzzier), etc. (Just another topic to be covered at our round-table discussion at the CRE Convention (and at our Jacksonville workshop next Saturday)

Bill Gatten

Help! - Posted by Greg

Posted by Greg on February 04, 2001 at 09:53:06:

Anyone got ideas on how to buy properties ‘subject to’ existing the financing? If I can’t “get, take over, qualify or other wise satify the existing financing” the deal is dead, right?

I understand the principal but not the contract language used. I have found some properties that are vacant or abandoned with existing financing on them and the owners just want to walk away.

I want to buy them subject to the existing financing.

I then will sell it to another investor and receive enough of a down payment to cover all back PITI and such.

I just don’t know what language to use to buy it.

How do I do this? Will it trigger the DOSC or alienation clause?