Paul:
A cash down payment that can be documented is best. It shows that the buyer has saved up the funds or has access to the funds he/she is willing to put at risk when purchasing the home.
A “toy” (boat, jet ski, ) or a vehichle would be OK but not nearly as acceptable as cash. If you do decide to go this route, make sure you obtain a copy of the vehicle title, take some color photos of the item, perhaps have an indepedent car dealer, boat dealer, etc. provide you with a written estimate of its book value.
Naturally the other vital factos surrounding the transaction will also come into play when evaluating the note (employment, stability, overall credit profile, credit scores, income info and documentation, payment history, location and condition of property, etc.)
Posted by Paul_MA on October 24, 2000 at 20:25:41:
Hi all,
I’m selling my $30,000 two family property with owner financing. I will sell the owner financing to a note buyer after the seasoning period of about 3 months.
Here’s the question:
If I take a boat, RV, or a vehicle as the down payment, is this acceptable to note buyers? How will I determine the value of the boat, RV, or a vehicle?
I wish that I had a buck for each time someone asked why the market value of their note was significantly less than they had anticipated that it would be after seasoning. The value will be driven by a number of things as Mike indicates, INCLUDING the structure of the note.
You may want to touch bases with a professional for upfront advice, rather than be dissapointed later and bark out the phrase “Geez, I wish I would have asked first…”