Posted by John Behle on January 12, 1999 at 21:52:55:
Here’s one we are working on today. Mobile home note. $45k sales price, 6 months ago. $42500 note. 1971 mobile that has been totally rehabbed. Land is included (making most of the value). Lot and mobile are in a very nice area and great condition.
Problem. Too new, too large, too high of an LTV and an 80 year old seller that would not consider anywhere near the type of discount needed for both safety and yield.
Discussed partials. Listened for that “Magic Word” Karp mentioned below. Found their need is not for cash or cash flow, but to split up the assets so the kids don’t fight.
This will likely end up being a nothing down note deal with multiple partials gifted to the kids to avoid taxes and estate problems. Cost - 0 -
Profit. Will structure with a monthly cash flow of a couple hundred dollars per month and possibly a piece of the 5 year balloon.
That is Win/Win - on a deal that most consider impossible.