Re: quick sale of my home - Posted by eric-fl
Posted by eric-fl on July 01, 2004 at 08:45:40:
Js, if I may humbly disagree.
I actually thought you WERE a sub2-'er (buyer). In that case, this strikes me as a little odd.
Let me play devil’s advocate, for a moment, as I have no stake (other than just intellectual interest) in this.
Would you, as a motivated seller, not WANT for the investor/buyer to be in a “stronger” position?
What I mean by that is this: I, as an investor/buyer, am far MORE likely to walk away from a difficult l/o than a sub2. On a sub2, I own it. I am legally responsible for it. I have the right to make alterations, additions, amenities, repairs. I have full right of hypothecation. I can get as creative or funky as I want in order to sell it. I can play with price or terms much more so than on l/o. And I can take a tax deduction on it, and depreciate it. As well as write off any repair or maintenance expenses.
I can’t do any of that on an l/o.
To me, as a buyer, the advantages of a true OWNERSHIP-type of situation, such as sub2 or land contract, so far outweigh that of l/o, I wouldn’t even bother to buy with it - with the minor exception of it being a 3 to six month “trial deal”, that automtically converts to a sub2 with my timely payment. (Also might not be a bad counter-proposal for the originator of this thread).
I would also submit that this thread originator, or any seller looking to sell to an investor sub2, do their due diligence. But then, that’s something that everyone should do all the time, regardless, right?
IMHO, this wouldn’t be too hard to flesh out. Just ask the investor some pointed questions: “How long have you been doing this? How many other properties have you bought like this? Do you have any testimonials, referrals, any people I can contact who can vouch for you? What qualifies you to do this? Do you have to have some sort of a business license to do this? Is there some sort of agency or oversight body that regulates this? Isn’t this sort of like banking or lending are you interfering with banking regulations by doing this? Is this legal? What happens if you die?”, and so on.
We both know the answers to those above questions, but a seller may not, and they should. I can say that I, personally, would not have any trouble answering those questions, and would respect a seller more for asking it. I’d honestly rather do business with people who have their heads screwed on straight. But such a line of questioning WILL flush out and fluster an inexperienced “seminar graduate” who may not have adequate experience or capital, and really has no business doing such a deal. But my overall point is, sub2 CAN be a good thing, and often, the BEST thing, for both parties involved, when done properly. You just have to do your homework, whether your a buyer OR seller, if you don’t want to get burned. In any business, not just real estate.