Something Joe Kaiser said ... got me thinking... - Posted by Sally Fodern

Posted by JP on August 16, 2003 at 20:35:26:

Figure out some more great strategies so you can write about them in future courses. =)

Something Joe Kaiser said … got me thinking… - Posted by Sally Fodern

Posted by Sally Fodern on August 13, 2003 at 17:30:14:

Was reading some archived posts and came across a thread on dealing with people in foreclosure who insist on staying in the property. Joe Kaiser said:

“Today, I am more inclined to purchase a percentage of the property outright rather than do the sale/lease option thing like the HH. That way, there is nothing left to chance . . . no wondering what will happen to my interest down the road. My profit is locked in from day one, and it’s their half that is now the only part of the equation we really aren’t quite sure about.”

Can anyone elaborate on this? If I understand this correctly, the idea would be to pay 10k (or however much the homeowner needed to get caught up, etc.) for a 50% interest in their property. Basically they deed you half. Then there is a clause in there somewhere that says they have to cash you out (either sell or refi) within 2 years, or something like that, at which time you’ll collect 50% of the equity. Hmm I guess you could actually use this strategy even if they didn’t care about staying in the house. You just pay the money necessary to get them caught up, they deed you half, then they stay in the house for the next few months until it sells, at which time you split the equity. Is that basically it in a nutshell? And it’s best done this way to avoid the transaction being a loan with a resulting interest rate that would get you in big trouble? Anyway, if someone can elaborate on this I would sure appreciate it. Thanks!

Re: Something Joe Kaiser said … - Posted by Joe Kaiser

Posted by Joe Kaiser on August 14, 2003 at 23:31:41:

I’m more inclinded to do the 50/50 deal today, but it’s a
complicated transaction that requires more than a casual
understanding of the foreclosure business.

It’s highly profitable but the obvious risk/reward ratio must be
looked at and found acceptable. Frankly, there are days I wonder

I wouldn’t be escrowing a deed for their half, btw.

Documentation is critical and highly technical. We used to do
these deals with little more than a purchase and sale agreement
and a handshake. I’m still wondering what I was thinking when I
let that happen.

The big problem, in a nutshell, is people lie. One day you save
their bacon and six months later they claim you took advantage of
them and dream up a list of transgressions against you. If you’re
not prepared to deal with this sort of thing, it becomes difficult.

We’re doing a much better job of things today. Would like to turn
the clock back six months or a year and tighten up some of the
deals we did . . . but that’s the way you figure it out, I guess.


big risk? - Posted by John V, FL

Posted by John V, FL on August 13, 2003 at 23:55:55:

What if the owner is an deadbeat and doesn’t pay his share of the monthly payment after you reinstate the loan and then in essence lives rent free for at least another 4-6 months until either the bank forecloses again or you win a partition suit? Or if your agreement is for him to live for free until you close the sale to a third party, take it out at the back end but he just moves before closing and can’t be found to sign the closing papers. So you the investor pays the mortgage for a up to a year and has a chance of losing it all while the deadbeat lives for free. Iron clad contracts and partnerships mean nothing if you can’t enforce them or cash in your equity. What am I missing as I’ve thought of this angle in the past but shy away for obvious reasons?

Something Joe Kaiser said … got me thinking… - Posted by Brian Powers(MI)

Posted by Brian Powers(MI) on August 13, 2003 at 19:31:19:

i would say you have the basic overview. but i believe joe gets paid back what he put into the deal first, and then they split the remaining equity. also, i believe he puts a deed for the remainder interest the homeowner has into escrow and the agreement states that if the homeowner defaults on any future payments the remainder interest is then deeded to joe.
this is my interpretation of course so you might get a better version from joe.

Re: Something Joe Kaiser said … - Posted by Perry

Posted by Perry on August 15, 2003 at 16:01:39:

Is all of your up to date strategy and documents in your recent material i have heard about?

Not if… - Posted by Sally Fodern

Posted by Sally Fodern on August 14, 2003 at 05:25:29:

I forgot that there’s a 2nd part to it. There is also a signed and escrowed quit claim deed with instructions to transfer their remaining interest in the property to you should they miss any payments.

Re: Both posts - Posted by Ed Copp (OH)

Posted by Ed Copp (OH) on August 13, 2003 at 20:45:14:

have a fair overview of the subject.

Elaborate, I could but I won’t. You see Joe covers this issue in detail in the course that he sells on the subject. I purchased the course, so I could elaborate, but that would not be fair to the producer of the meterial.

Yeah, any updates on the courses? - Posted by JP

Posted by JP on August 15, 2003 at 16:20:04:

I have bought ALL of your courses Joe, and I was also curious if there are any updates, etc. we can buy? Where’s the beef?! =)

Well I have the course but … - Posted by Sally Fodern

Posted by Sally Fodern on August 13, 2003 at 22:37:41:

Yeah I thought it sounded familiar so I went through my library of books and courses. I have the course, and he devotes only about 1.5 pages to this subject - pages 77 and 78 of Totally Dominate your Foreclosure Marketplace. I was just looking for some clarification to make sure I understand it right. You say “Joe covers this issue in detail in the course” … are you referring to another course, or am I missing something? The course is very VERY good, but I wouldn’t say that he “goes into detail” on this specific idea based on what I found on pages 77 and 78.

Re: Both posts - Posted by Curt Dalton

Posted by Curt Dalton on August 13, 2003 at 22:30:59:


Which course is that?


Re: Yeah, any updates on the courses? - Posted by Joe Kaiser

Posted by Joe Kaiser on August 15, 2003 at 23:28:03:

Working away . . . but I’m doing a ton of real estate business at
the moment so it’s tough to put in the required time to make a
really great course.

You can be sure that once available, you’ll learn about it here first.


What’s your #1 source of deals? - Posted by Antonio Vargas

Posted by Antonio Vargas on August 17, 2003 at 10:33:33:

Just curious Joe, what would you say is your number #1 source of deals these days? Are you just doing a lot of foreclosures, or something else??