Posted by Brent on November 28, 2000 at 03:09:41:
You are asking the seller to take the automobile instead of a second on the real estate. Even if he thought it was a dream car, it is a rapidly depreciating asset that is 100% leveraged. It isn’t the same thing as an asset owned free and clear. He can’t sell it, trade it, or transfer the title without paying off the car loan. You’re really offering the use of the car plus your unsecured promise to pay for it. It is my belief that anyone with landlord experience would recognize the weakness in the offer and not take you seriously. The only way he knows your credit is important to you is if you tell him so repeatedly.
Maybe you could add collateral to the deal so the car isn’t standing alone. How about:
an unsecured promissory note due only if you don’t pay the car note (your credit was good enough to buy the car, the note must be worth something);
a note secured by your furniture;
your first-born child;
He knows you have no experience. The idea is to give him reason to believe that you won’t walk at the first time of trouble because you have something to lose. Trouble is what made him tired. Sellers must believe that you have the energy, determination, and ability to learn new skills necessary to solve the problems that he couldn?t or wouldn?t. Then, they will consider entrusting you with their hard-earned assets.
#2 I understand the deal is hypothetical. 30% for expenses is often illustrated, but is at the low part of the range. Try 40-50%. The folks on the commercial board deal with multi-units all the time. If you read all the posts from the first through the current ones it is possible to gain the equivalent of hard-knock experience in a short time. Can?t beat the price either.
IMO, reviewing all the posts on this board too, will give you the insight one needs to fully appreciate the information imparted in the courses you have coming to you. Sometimes understanding comes in flashes. It comes quicker when your mind has a pool of related (real estate) knowledge to work with. More tools to choose from.
For trust info, check out www.cal-equity.com.