how many ways are there to buy property - Posted by newbie_IN

Posted by David Alexander on July 05, 2001 at 22:28:09:

Some form of money is someone elses. And sometimes even the sellers, if you structure the deal right.

That way I can be on the same train as ya’ll, but I’m up in the first class cabin, havin’ a drink, and hopefully someone else is buying that too.

:wink:

David Alexander

how many ways are there to buy property - Posted by newbie_IN

Posted by newbie_IN on July 05, 2001 at 08:06:18:

with NOTING down TODAY?

From reading the archives here, I understand that bascially, there are

  1. Taking over payments, called ‘subject to’
  2. Lease Options
  3. Wraparound mortgage
  4. Land Contract
  5. Owner financing

So…really, there are only five ways to aquire property nothing down. Am I missing anything?

Re: Only ONE… - Posted by Ed Copp (OH)

Posted by Ed Copp (OH) on July 05, 2001 at 10:08:56:

All other discussion pertains to financing of property. The only way to buy is for cash. The buyer brings cash to the seller and the seller delivers the deed.

Re: how many ways are there to buy property - Posted by eric-fl

Posted by eric-fl on July 05, 2001 at 08:42:26:

Yes, you are missing a lot. You are attempting to enumerate different generalized buying strategies like tools in a toolbox, such that you can then take those tools and go build something. That’s an okay place to start, but it’s really only half the picture. One has to realize, that, with most tools (and buying strategies), there is more than one use, and more than one way to use it. For instance, a hammer can drive nails into wood, but it can also pull them back out. In a similar vein, the above strategies you mention are often not mutually exclusive, but rather used in conjunction with one another. For instance, it is quite common to purchase a property “subject to” it’s underlying liens, but then resell it on land contract, or a lease/option. Any of the above would be an example would be an example of your #5 category, Owner financing, and also makes use of #1, and either #2 or #4, all within the same deal.

I would submit, rather than to have different “ways” of buying, and thinking of each as being mutually exclusive, that instead, you think of them as the notes in a musical scale. There are only eight notes in a single scale, and each note is distinct, but the number of ways to combine them is infinite.

In addition, there are other strategies that you have not mentioned. For instance, if I want to buy a house ‘subject-to’, (#1 on your list) with “owner financing” (#5 on your list), and the seller wants some down payment consideration, but I do not want to pay cash, I could:

  • Get the cash from a credit card, or a partner, which is still “nothing down” to me, and is not on your list.

  • Offer them something else instead of cash for the down payment, such as bonds, or perhaps a small second mortgage I took back on the sale of another house. This is called “substitution of collateral”, and is not on your list.

  • Offer them services I am uniquely able to perform, instead of cash. This is called “barter” and is not on your list.

So, in conclusion, to answer your question, there are many more than five ways to acquire property for nothing down. Hope this gets the gears turning.

Re: Only ONE… - Posted by Bill Gatten

Posted by Bill Gatten on July 07, 2001 at 19:41:46:

Wrongorooni Mr. Copp. That may be, figurately speaking, the only way to “own” the property; but “buying” something is a process including the financing of it. Taking your analogy to the extreme you could never buy anything with cash because the money your bring to the table si merely a stack of notes due to the U.S. treasury.

Just checking in… :slight_smile: And yes, I did read the whole string (3 times before and after supper).

Bill Gatten

Re: Only ONE… - Posted by JohnBoy

Posted by JohnBoy on July 05, 2001 at 16:13:25:

So are you saying when you purchase something on a credit card that you really didn’t buy it because it’s a form of financing? It doesn’t matter how you purchase a property, whether it’s using financing, cash, barter, trade, or what ever. It’s still buying it.

Re: No Johnboy. - Posted by Ed Copp (OH)

Posted by Ed Copp (OH) on July 05, 2001 at 16:31:19:

I am saying that the credit card is a form of financing. Read the post 3 times before supper, and 3 times after supper and you will understand…

Re: No Johnboy. - Posted by JohnBoy

Posted by JohnBoy on July 05, 2001 at 16:45:57:

You said there is only ONE way to buy. The buyer brings cash to the seller and the seller brings the deed to the buyer.

I’m saying this is not true, that this is not the only way to buy.

I sign a purchase agreement with the seller to buy their property by taking over their existing loan subject to. I did NOT bring any cash, but the seller did give me the deed. I now OWN the property, meaning I did BUY the property without giving the seller any cash.

Re: No Johnboy. - Posted by Ed Copp (OH)

Posted by Ed Copp (OH) on July 05, 2001 at 21:03:29:

In your example you say you own the property, by taking title subject to the existing loan.

I contend that you own the right to pay the payments each month, in some form of money. If the payments do not get paid you can’t keep the property. As in the first example you mentioned using a credit card. Well the seller did not leave with your credit card, it is not money. I would contend that he left with some form of money that you borrowed using your ctedit card.

I think we are on the same track here, heck we are probably even on the same train but, one of us is in the lounge drinking lemonade, and the other is in the baggage car. I am not sure who is where, but we will both arrive at about the same time.

Re: No Johnboy. - Posted by JohnBoy

Posted by JohnBoy on July 06, 2001 at 07:00:07:

In that case wouldn’t it be fair to say you really never own the property, but only the right to continue to pay for it? If you don’t pay the taxes every year you can’t keep the property.

I’m going to move to the first class car of the train and see how much it will take to twist David’s arm into buying me one of those drinks. :slight_smile: