Re: My 1st deal , Please Help!! - Posted by Tony-VA
Posted by Tony-VA on February 11, 2003 at 07:48:11:
In my area, your land/home package would have been a decent deal. But your sell price seems quite low if the $18,000 you negotiated was truly a “steal”.
A seven grand discount from fair market value is not really a steal. To many things can come up and eat that profit away.
If you were flipping this property tomorrow for $7k, that would be one reason to keep such a low price, but bear in mind that owner financing merits a much higher sell price. This is accomplished by creating affordable monthly payments for the buyer.
Since you are coming up with the down payment via credit card, you have done a no money down deal, but leveraged yourself on high interest, short ammortization. Granted it is not a lot of money, especially if you immediately apply the buyer’s down payment to it, but this is a poor habit to get into. Buying a long term property on short term financing terms has broken more than one “no money down” investor. Just keep it in mind. Probably not a threat on this one but could be on future deals.
I would suggest you find out what the market price for this land/home package might run. Then bump it a few grand for the owner financing.
You might also consider a lease/option deal. This gives you an opportunity to lease the propert with little to no landlord headaches while allowing you to ask a slight premium in price. You could then assist the buyer in obtaining financing through a bank or mortgage broker to cash you out sooner.
Much depends upon what your exit is. If you are simply looking for payment streams, then bump that price, increase the payments or work the terms so that you do receive a long term income stream and one that is worth your investment and time.
That is why I love these land/home deals, so many exits that can solve problems and make you money.