Yes, the Cash Cow course has tons of info on how to structure deals that will produce cash flow for years. Several different techniques are covered as well as the LC type deal we just covered. As usual with his courses, the docs are great, and cover all the bases.
The deal I told you about was especially sweet as the seller just handed the keys over to a 8 month old house and I had it sold within days. I had 0 in it and collected that 13k up front, plus about 150 per month until they refi and then an appx. 10k backend. All this on top of the sellers 7% loan. Gotta love it!
Hey Guys,
I could use some feedback here. I have a sandwich L/O for 26 years that I will be converting to a subject to within the next week. I have a buyer who can put 10% down for owner financing. I’m clear on the subject to purchase process, but I’m not positive on the owner financing. Please review my thinking to point out missed steps.
I will sell on an ILC (CFD) and will not be escrowing docs (other than in my filing cabinet). I can’t find any assistance in any of my courses on selling with owner financing after purchasing in a land trust. I think I will need the following docs for the sale side:
ILC
ILC note
assignment of BI
Do I still need a Warranty Deed if I’m assigning BI? What other major docs should I be using? Thanks for all input…
I’m in the middle of my first one right now, so take what I have to say with a grain of salt: I don’t plan on assigning the beneficial interest over while selling on ILC. I plan on having the trustee signing the ILC to just flat out sell it (by deed transfer, not assigning). Maybe I’m missing something. If so, let me know.
Also, my attorney gave me a little tidbit: He said have the buyers sign a Special Warranty Deed. It suppose to be a little stronger than a Quit Claim Deed. I don’t think it will make that much of a difference, but that was one of the few things that he wanted to change on Bill Bronchick’s Pro-Seller ILC docs.
GregNorman
PS - There are some differences in the Nuts & Bolts and the Cash Cow. The Cash Cow has pro-buyer/seller docs, the addendums to add to purchase contracts, and truth in lending stuff. I’m sure there is some other stuff I’m missing (I don’t have everything in front of me right now). I felt I had a thorough understanding of the buying/selling subject to stuff with the Cash Cow and Land Trust courses.
I took a house “subject to” this past January via the land trust according to Bronchick’s course. I then sold the house on an unrecorded Land Contract, which sounds like what you are trying to do here.
I used an atty to close this deal as the buyer was a little more sophisticated and seemed like he was needing this to feel secure in the transaction, probably due to the fact that he put a pretty large chunk of cash down on the house. (13k)
Anyway, I followed Bronchick’s cash cow course on the docs to use and hold in escrow. They were as follows…
Warrenty deed to buyer from land trust
QCD from buyer to land trust (in case of default, to simplify the eviction process)
Installment Land Contract
Installment Land Contract promissory note
Truth in lending disclosure
Escrow agreement
bill of sale (from land trust to buyers for appliances at property)
affidavit accompanying QCD (explaining to buyer that if they dont pay, the QCD will be recorded and that they will have no claim to property)
DOS Ackowledgement (explaining to buyer that they are buying a property on an unrecorded land contract that has another mgt on it and if the lender finds out there may be a problem)
Representation disclosure (explaining to buyer that my atty represented the land trust and not them)
Amortization sch for buyer
HUD 1
Payment notice (telling them amount of monthly payments, breakdown of what anount for txs, ect.)
I followed Bronchick’s Cash Cow course to the letter on this one. If you don’t have the course, I would get it. I believe it really compliments the land trust course.
This one was the first I have done but it has turned out really well. Sorry this was so long. Hope it helps you.
Good Lord! This buyer gave you 13k up front, and then signed a quit claim deed for you to keep in your back pocket? And this was a sophisticated buyer? How did you manage that? Don’t get me wrong, it’s great for you, but if I were buying a house like this, and the seller wanted several thousand, and then a quit claim deed from me “just in case” I defaulted, I think I’d have some words for him that wouldn’t make it past this message boards censor software. Did he object to this, or did it just sail through? Is this a common thing in this type of transaction?
William,
Thanks for the info. I wasn’t aware of numbers 5 and 8 and won’t be using 6 and 10. This is exactly what I was looking for.
On a side note, it sounds like the Cash Cow course has good info that is not included in the Land Trust, L/O or Nuts and Bolts courses. Is that true? Thanks…
It is pretty rare for someone to find a brand new, 130k home that someone is willing to owner finance for you, around these parts anyway. These folks had an opportunity to buy this home without paying any of the normal “junk fees” that they would have incurred, even if they could have qualified with the bank,so they saved significant cash there.
Believe it or not, this was a somewhat sophisticated buyer, at least more so than I usually see, and no, there was no objection to the quit claim deed.
This was an Agreement for deed. If he does as he says he will, I will do the same and there will be no problems. So far, he has been paying like a slot machine. I suspect with that large a cash investment, he will continue to do so.