It’s all about YIELD - Posted by Phil Pelletier
Posted by Phil Pelletier on August 11, 2003 at 19:48:32:
That’s right. It’s all about YIELD on the investment. The only reason we hold the notes in the first place is because there are few qualified buyers with cash in the market. There is nothing better and more pure than buying a home and selling it for more than you paid for a few weeks later. If we could all take cash for every sale, we would, but the market does not support many cash transactions, so we hold notes, and bare all the risk that holding a note entails.
Think cash FIRST, then offer the note second.
Obviously, the way to get the phone ringing is to offer financing, but I always offer a HUGE discount (50%) on the home if they pay cash. The last one I sold was a home I had 6 people want to pay me $12,000 for over 4 years, but no one could meet the park qualifications, so I sold it for $6,000 in cash and RIPPED it out of the park. It was beautiful, man! (Sorry, I jumped to my war movie lines). Anyway, they moved the home and set it up on their own land. They got a loan from a relative and paying cash now got them a great discount, so the term of the loan is short.
I was pleased because the YIELD on my investment of $2,000 was huge over the three months I had the place. Your’s will be even better.
Think CASH first, Note second.
Think aboout how many deals you could do with that cash? You would have over $100,000 in cash inside a few months at that rate. Not a bad way to spend your time.
PS- Do I see you are in Oregon? In Corvallis, near the school?