John Behle, cash flow forum mentor!!!! - Posted by Frank Pluzdrak

Posted by John Behle on March 09, 1999 at 18:41:10:

A property seller generally takes paper because they aren’t motivated. They might have to discount heavily for cash. The exception is when they need an installment sale.

Occasionally the seller is motivated to sell their note at a discount right after the sale of the property, but usually you need to buy another note at a discount and “trade” it to them (use it as collateral).

John Behle, cash flow forum mentor!!! - Posted by Frank Pluzdrak

Posted by Frank Pluzdrak on March 09, 1999 at 11:40:14:

In the book, The Paper Game, pg. 24, “Buying Real Estate with Paper”, a $50,000 contract is created in the process of purchasing a property valued at $100,000. At 24%, this contract is worth $25,045.41. One option you discuss is to substitute collateral for the contract. For example, 5 - $10,000 notes purchased originally at $5,000 each.
The other option, is to refinance at the close and “buy the contract with the funds from the refinance”.
Could you explain why the seller would be willing to take $25,043.31 for the $50,000 contract?
Is this just a reflection of the motivation level of the seller?
I hope you will supercharge this site once again!!!