upside down - Posted by Greg(TX)

Posted by Jason (AL) on April 28, 2005 at 23:30:13:

I know of some folks who actually have taken mobiles sub2.
They’ve done them in parks as well as mobiles on land.

What they did was simply take over the payments, sell owner financing for a few thousand down, charge more in interest per month for a positive cash flow, and just let the loan run out.
There is obviously no back-end.
Up to you if you’d want to do these or not.
I know most preach NOT to do them.
But if the numbers work out, I don’t see why not.

upside down - Posted by Greg(TX)

Posted by Greg(TX) on April 28, 2005 at 21:50:53:

I know that there are alot of post of how we can’t help out a seller who is upside down in their mobile. I have been thinking and… does anyone know of the bigger fool principle? I would tell the seller that you will pay him what he owes when HE finds a buyer that needs financing at a price that works for me(down payment and terms). Since this is risky(LTV) I will demand a high rate of return and/or have the seller contribute to the pay-off to increase my yield. Be the bank. Any thoughts?

Re: upside down - Posted by Lyal

Posted by Lyal on April 29, 2005 at 07:08:14:

You still have a problem if the “greater fool” bails and you get the home back. Then you need to pay expenses until you find another one.

I think a better use of the seller’s time would be to go back to the lender and discuss a shortsale. You could provide a purchase agreement at a price that works for you and maybe some pictures of repairs that may be necessary and let them run with it. They could explain to the lender that this is the only offer they’ve gotten, they don’t have the money to fix it up (truck needs a new engine, got laid off at work etc…) and if they won’t take less, they’ll just need to take the keys and pay the lot rent until they can re-sell it.

You can couple this to a seller contribution too if they have it and are motivated enough.

Problem here is that you’ll need to cash out the lender somehow. You’ll need to get money from your bank, your 401k, an investor… OR from the bank agreeing to the short sale.

The upside is you’re into the home at a manageable price even if you get it back.

All the best, Lyal