Ok, here's my deal, am I crazy to think it will work? - Posted by Frank A (WI)

Posted by Sheik on June 17, 1999 at 09:19:20:

You didn’t mention how much down pmt (if any) you’ll
get from your buyer…

From what I know about these Simo deals, a note buyer
will typically go up to about 80% ITV (Investment to Value).

One way to structure (it will depend on the credit
worthiness of your buyer) is as follows…

You need to get approx 10% (or more, of course)
down pmt from your buyer (Approx 15K).
Create a 1st mortgage for approx 80% of the FMV which will be approx 119K. If structured right, you should not have to discout it much. Create a 2nd for the

After selling the 1st you should have approx
$119K + $15K - discount - other costs.

At closing you should be able to pocket a few Gs.
You will also have the 2nd paying you monthly.

Hope this is somewhat clear.

Click on the American Note Banner above - they buy
these types of notes and will advise you on how best
to structure your notes to make it worth more.

Also there is a similar deal done by Ben(IN)
described in the Money Making Ideas section or the
Success Stories.


Ok, here’s my deal, am I crazy to think it will work? - Posted by Frank A (WI)

Posted by Frank A (WI) on June 16, 1999 at 21:56:55:

3bd/1.75 bath Ranch FMV $149,000

Seller motivated, willing to except $125,000

I am a mortgage broker so I come across people with serious credit problems that still want and can afford a house. But no one will finance them. I would like to help these people plus make some money as well.

Seller is willing to do 100% finance if they can get cashed out at closing.

Here is what I was thinking;

Get the house for $125,000, flip it to my client for $149,000. Create a note and sell it at the same time paying off original seller, and pocketing what’s left. Somewhere between $15,000-23,000.

Am I crazy for thinking this could work?

I have recently gotten scaried by reading about note buyers who will pull credit reports to determine discounts. With my clients credit the way it is, would I basically be doing this flip for free?

Or should I sign my interest in the deal over to my client for the price of $125,000 and create a note carrying a second for the remaining $24,000.00?

Clients expect to pay premium for property based on the credit.

If I can make this work and come up with a formula for it, I could expand my business and really help my clients by becoming more creative with solving their housing and financing needs.

Any and all input would be helpful. I know I can find the deals if I can make this work.

Thanks in advance to everyone. I’ve learn so much from reading this site everyday.

Thanks again,

Frank A (WI)