Posted by Don (Fl) on February 23, 2001 at 16:13:10:
I am in a similar situation as you. I have an investor who only wants to put up the money and absolutely no other involvement. We worked out a plan that he funds the purchase, rehab (if any) and carrying costs (if any). Then upon the sale I get the down payment and he “buys” a partial from me for a price that yields him 30% per annum. For example:
Purchase, rehab and carrying costs $3,500
Sales Price $7,000
Down Payment $1,000
Loan Amount $6,000
Term 3 years
The investor buys a partial of my new note for $4,131 and receives $175.37 per month for 36 months which yields him an attractive 30%.
I receive $1,611 in cash (down payment plus the difference between the note sale and the purchase price). Plus I get $26.79 for 36 months. I am responsible for buying, rehabbing, selling and managing the notes. He gets 30% yield low risk for putting up the money.
It works for us!