Posted by Brent_IL on April 07, 2002 at 22:56:46:
No, missing nothing.
I was thinking that Bill Gatten recommends holding three monthly payments in a contingency fund that will provide a lead time if you need to find a replacement R/B. Based on Trisha’s questions, I suggested a PACTrust because it’s available as a turn-key option.
As you know, the seller is always at risk for something in any kind of seller-assisted financing.
Owner financing?? Could it work?? - Posted by Trisha(NC)
Posted by Trisha(NC) on April 07, 2002 at 09:40:30:
I have a deal brewing with a seller who has a house valued at 80k, she has a mortage on it that is assumable but, requires qualifying, she owes 41k. Her payments are $490 a month and the tenants have been paying 500 for the past 10 years. They are moving at the end of April and I have been in the house and it is already for someone to move into. How can I construct offers on this house? I know that wholesale is out of the question. And she is too credit conscious for a l/o. What about an option or owner financing? How could I construct it to make it work? If I could get it under contract and put someone in it, the rents would easily be $800 a month b/c it is in a good area and it has a lot of land to go with it as well, enough were someone could park a trailer in the back. What do you think?
Trisha
Re: Owner financing?? Could it work?? - Posted by Brent_IL
Posted by Brent_IL on April 07, 2002 at 16:09:44:
I’d review the entire PACTrust approach at www.landtrust.net With this type of arrangement your seller would minimize the effect of leaving it up to someone else to take care of her mortgage with the possibility of fouling up her credit. Even so, you can?t force a seller to accept anything they don?t believe is in their best interest.
Re: Owner financing?? Could it work?? - Posted by Gerald Stidham
Posted by Gerald Stidham on April 07, 2002 at 11:18:52:
One option could be to flip it, you would need someone
in place to buy it, and do a sim. close. This way you would only be looking at a one lump commission. Listed
below is a e-mail that I found which you could use to
get some free reports on the subject.
Hope this helps.
Re: Owner financing?? Could it work?? - Posted by Trisha(NC)
Posted by Trisha(NC) on April 07, 2002 at 10:14:00:
The property appraised for 80k, she wants 82k. When asked what she would take for all cash, she said 75k. She wants the money to pay for some land that she wants to buy so that she and her husband can build a house to take care of her mother so she does not have to be put in a nursing home. When I said how about 60k cash she said she had to think about it. I approached her with a l/0 but her deal was that she did not want to leave it up to someone else to take care of her mortage and possible foul up her credit. Maybe I did not pharase the l/o correctly to her to make her understand it. I would like to get undercontract and flip it to someone else. But, I really want to learn the l/0 deal and options or owner financing side of it so, that I know what I am doing. Any help is appreciated.
Trisha
Re: Owner financing?? Could it work?? - Posted by JohnBoy
Posted by JohnBoy on April 07, 2002 at 10:00:20:
You say its worth $80k and she owes $41k.
What you don’t say is what she wants for it or what she will take for it?
You don’t say why she is selling?
What does she NEED out of this?
Before you can think about ways to make a deal you need to know what the seller’s motivation to sell is and what they really NEED out of it.
If they have no motivation then all the different ways to structure a deal isn’t going to do you any good. If there is no motivation to sell then there is no deal.
So far the only thing you’ve told us are things that appear to show she has no motivation to sell other than get cashed out.
If she doesn’t want to sell on a L/O then she isn’t going to want to sell with owner financing. She’s to credit conscious for a L/O? Credit conscious about what? She’s been leasing it for 10 years, so what exactly is she credit conscious about?
Will she take $45k CASH for it??? $50k??? What???
If she sold it out right, what will she do with the money she get’s from it? Does she NEED the money for something else? What?
Will she just stick in the bank and collect 3%?
Re: Owner financing?? Could it work?? - Posted by JohnBoy
Posted by JohnBoy on April 07, 2002 at 17:34:31:
How would a PACTrust minimize fouling up the seller’s credit over any other method of buying? Just because it’s in a trust? That wouldn’t prevent anything. Because they use a 3rd party escrow? That wouldn’t prevent anything and you can set that up regardless of the method you use to buy. Is there something else I may be missing here?