Re: This is a big money deal. You just gotta show up. - Posted by Ben (IN)
Posted by Ben (IN) on March 19, 1999 at 20:59:30:
Fill out a lease or a Contract between you and the seller. Make the payments and the term on the lease the same as the loan. This is representative of the incoming cashflow the seller receives from you. It is also documentation the seller can show to his/her new lender to show he isn’t responsible for the payment on the old loan showing up on his credit report. If you use a Contract it ends up being a wash (because a management expense doesn’t have to be factored in).
If the FMV is $160K and the loan balance is $150K, you will have “No Problem” getting $20K down. Especially with 7% interest. In fact, I change my tune on just selling it “subject to”. The payment at 7% is $997.95. Sell it on Contract with $20K down and a payment of $1250/mo. Pick up the cashflow for 30 yrs.
THe fact that the owner hasn’t been able to sell it means nothing! What has he been doing to attract buyers? How has he handled them? Obviously badly because he hasn’t sold the place. And its becoming a problem. He’s beginning to realize he’s out of his depth. You see this is why you do this business, because you know stuff he doesn’t. Your seller sees a house that won’t sell. But you, who understands no qualifying owner financing and marketing, see $20K down (if not more) and $1200 a month.
You see no-one’s getting an appraisal here, you can put the price wherever you want. Let the market tell you what is too high or just right. I tell you what. If you put your ad in and the house sells in a week, you know you priced it too low.
You’ve got to understand Jim that people who can’t get bank loans have slim, slim pickins when it comes to buying a house. When you put these things on the market, so long as its a nice property, they “go”!
But get it under contract first. Depends on your sellers frame of mind too, how motivated he/she is.
e-mail me if you need some help.