selling my cash flow for a chuck of $ now... - Posted by ben

Posted by michael schindler on August 05, 2004 at 09:01:37:

I don’t think that deal would be able to be done factoring in what you said. their score is important when selling the note, and the LTV is another ding. The buyer would do an appraisal, etc and they wouldn’t give you anywhere near what you would accept for the partial sale. If you’re lucky, it looks like around 50% of value IF they would even do it at all plus, after the fee’s you would entail for that little amount, it wouldn’t be worth it so, why would you do it? Why don’t you just sell it to them? I’m sure they could get a loan of some kind and you could hold a second for the rest if they have no down (the particular program will depend on their credit scores). Use a good broker that could explain your options you. Just my opinion

selling my cash flow for a chuck of $ now… - Posted by ben

Posted by ben on August 04, 2004 at 12:29:10:

I’m a “well read intermediate” in real estate, with a half dozen deals done, no experience with notes (but a good financial head) and want to get a chunk of money in exchange for cash flow on a land contract I have.

Just closed on the house in July, bank financing, P&I Payments of about $510, loan value of $73,800, purch price 82k.
Needs very little work, pretty solid house should appraise for 110k.
I’d like to pull out up to 80% of the to-be appraised price, and will give up some of my $300 net positive cash flow created from a the land contract I used to sell the house.

How do I go about this, how much payment history/seasoning should I have before I do, and what would be a going rate?
The payors on the note have rather poor credit, but great, verified income.
Let’s say I was willing to give up 10 years of $150 per month at 10%… that’s a PV of $11,350.67.
Is that in the ball park of what can be sold?
That’s LTV of 77.4% assuming an appraisal of $110k

What other considerations are there?

Thanks for any help.