Normally… - Posted by David Alexander
Posted by David Alexander on December 29, 2001 at 20:54:10:
if the interest rate were say 6 - 7%, I might say there is a way… Actually there is… Assign it… more on that at the bottom of the post.
You can work with the lender to make extra payments until the arrearage is caught up… (maybe $500 extra a month or something) get a note from the seller to cover the arrearage, with payments of $250 a month or so. Get a buyer with a downpayment and your cashflow of say $200 - 300 a month and that will cover the extra payments, plus leave the down in reserve to cover the negative if there is one it, (it should be small and short term).
After a few months, approx 12 in the case of this deal, you should still have cashflow coming from the seller and will be cashflowing positive $500 a month short term for your troubles.
Normally that would be done on a wrap…
In this case… with such a high interest rate, only do the deal if you find a buyer… Get a Release of liabilty once you sell to a new owner… disclose, disclose, disclose… (note, I have never assigned a deal and walked away)
You would do as above except the note from the seller would need to be secured or ahve a cosigner etc…
You would also just a get a small downpayment of cash and a note from the buyer.
You get the monies in each month and pay the extra you’ve negotiated with the mortgage company… while the new buyer makes the payment… In 12 months you should be able to keep the downpayment and start putting some cashflow in your pocket.
This has been more for excercise and to get your thought processes at least for me, as I would probably just go on to the next deal…
Easier to find a better deal than to lin up the stars and hope it all plays out right. If the interest rate were lower I’d probably take the chance… but not as it sits.
David Alexander