Jeanie:
I am glad your wheels are a turning. Welcome to wonderful world of owner financing. Learning how to combine real estate investing with financing can turn your world magically.
Note funders (my firm included) typically like to see some cash being put down by the prospective buyer. This can be as little as 5% cash down and in some cases if my exposure into the property is conservative enough and the buyer strong enought we can look at a very little down or no money down type deal. However we are usually looking at a note that would be funded at NO more than 60% -65% of value and this is under the best of circumstances.
As the note seasons or ages with payments these exposure levels can be increased however.
Owner finance - Note Buyers - Posted by Jeanie Wade
Posted by Jeanie Wade on April 09, 2000 at 18:30:21:
Say you are interested in buying a piece of property, and it is being sold - owner finance. Then you locate a company that buys the note for owner financed homes, and you then pay the new company the monthly payment - (who buys the note on the house from the original owner-seller at a DISCOUNTED PRICE). Does this mean that you can purchase the home with absolutely NO money down? This sounds too easy. If it is possible, please let me know.
Jeanie,
It is an easy process but most Note Buyers are going to want the payor to have at least 5% down into the deal. And depending on the credit and the Note rate you can get up to 90% and sometimes 95% LTV’s, with an average buy rate on the Note of about 95%.