Posted by Scarlett on July 08, 2009 at 19:41:32:
That was our thought also, I would think 10K on a $99,500 building. We will need a cushion in case he does decide to walk and not fufill his obligations.
Land Contract for an apartment buildng? HELP… - Posted by Scarlett
Posted by Scarlett on July 06, 2009 at 05:47:20:
We received a land contract on our 4 unit building. We aren’t familiar w/LC’s. We are in Ohio, buyer in Hawaii. He offered 6K down (covers only the realtor fees)on a 5 year contract.
Land Contract Sales & Financing - Posted by Michael Morrongiello
Posted by Michael Morrongiello on July 07, 2009 at 09:50:13:
Scarlett:
A land contract is like selling a real estate property and financing its sale similar to that of an automobile.
The LEGAL TITLE to the property will remain in your name until all of the terms and conditions of the land contract are fufilled. Then at that time LEGAL TITLE will be given to the buyer to consumate the land contract purchase.
During this period of time - while you are financing the buyer - the buyer is said to have what is often referred to as an “equitable title” interest in the property.
Different states handle your ability to repoesess and take back the property in the event of default in different ways. This is what you might wish to consult with a REAL ESTATE attorney about.
Another way to go is to do a LEASE with an OPTION to the buyer for 1 year to see if they prove themsevles. Then get them to convert to a land contract financed sale after that period of time has elasped.
Not sure what your sales price is fo the 4-Plex but $6K cash down sounds like a light down payment.
If structured properly - your land contract can also be converted into a cash lump sum at some future point of time through the actual sale and assignment of your interest in the land contract.
Visit us over on the Cash Flow forum for more details.
Continued best to your success;
Michael Morrongiello
Paper Practioner
www.sunvestinc.com
Author of the following home study courses;
Paper Into Cash - The Convertible Currency - How to Effectively Create Marketable Real Estate Notes
&
The Unity of Real Estate & “Paper” - Advanced techniques for both the acquisition and disposition of properties using Real Estate "paper
Re: Land Contract for an apartment buildng - Posted by Anne45
Posted by Anne45 on July 07, 2009 at 08:13:41:
Better to consult an expert.
Re: Land Contract for an apartment buildng? - Posted by Claude
Posted by Claude on July 06, 2009 at 09:47:08:
I hope that’s good prize.
Re: Land Contract for an apartment buildng - Posted by Ken
Posted by Ken on July 06, 2009 at 06:19:19:
Keep in mind if he does a poor job of management you are the one taking the risk,he can give it back and walk away and you are left to deal with the problems
Land Contract for an apartment buildng? HELP… - Posted by Scarlett
Posted by Scarlett on July 06, 2009 at 05:49:55:
>continued… We are talking to a lawyer today. We are not sure what to ask? What about default? We just don’t want to get into a mess.
Re: Land Contract Sales & Financing - Posted by Scarlett
Posted by Scarlett on July 08, 2009 at 19:38:24:
The sale price is $99,500 so yes the 6K is a very low downpayment offer of which we would require more. I really like the idea of a lease w/the option to buy once the buyer has proven himself. He is also asking to be listed as a secondary on the insurance on the building. We have not addressed that yet. Thank you for your insight Michael, I really appreciate it.
Re: Land Contract for an apartment buildng - Posted by james
Posted by james on July 07, 2009 at 17:22:22:
Is this like a sale or lease? A buyer can give back property, how?
Re: Land Contract for an apartment buildng - Posted by Ken
Posted by Ken on July 07, 2009 at 21:27:30:
Basically a land contract says if you do everything you are supposed to do like making timely payments etc you will get the deed when you made the last payment.If you do not do everything the person holding the deed will just take it back usually just with an eviction if the person lives in it or by written notice and stopping at the house and telling the tenants to pay them if it is just an investor.So essentially the person holding the deed is taking the risk because the new guy can just walk away so get enough down so if that happens you will be ok financially