Please help structure a Lonnie type deal - Posted by Ben

Posted by Raymond in Charleston, SC on February 29, 2000 at 08:28:27:

I’m a Real Estate agent, and if buyers can come up with 10% of $65,000 ($6500) plus their closing costs (probably $2,000-$2,500+) for a total of $9,000+ CASH up-front, they MIGHT not want a $60,000 house for $65,000…just a thought…I think Lonnie deals (mobile homes) seem to work well because you are literally out SO LITTLE money and get a GOOD PORTION of it back in the downpayment, and the monthly payments are low enough to make it doable even for someone with low/bad credit…

Please help structure a Lonnie type deal - Posted by Ben

Posted by Ben on February 28, 2000 at 18:37:09:

I am days away from taking title to a property through tax lien foreclosure. I am getting the house for $20,000, it is worth $60,000. To maximize my profit, I am considering a Lonnie type arrangement where I market it to marginal buyers
offering flexible owner financing. Ideally, I would like to sell it for $65,000, take 10% down, and carry back the rest at 12% with 2 points on the loan. I would like to do 5 years with a balloon at the end. Is this realistic first of all or am I pushing the “mooch killing” thing too far? What would my yield be and how would I calculate it? Many thanks for any help.