Subordination - Posted by BOB L

import · May 25, 2000, 7:34am

Posted by BOB L (NY) on May 25, 2000 at 20:27:24:

THANX DAVID

import · May 25, 2000, 7:34am

Posted by BOB L on May 25, 2000 at 07:34:55:

…offer the seller 1/3 down. On a $100,000 property, that’s
$33,000! That will make his ears perk up. You may be thinking, “where am I going
to get $33,000?” Relax, this is where subordination comes into play.

Find a hard money lender in your area who would be willing to lend you $33,000
secured by a first mortgage on the property. Give the proceeds of that loan to the
seller at closing. The seller gets a promissory note and mortgage for $67,000,
which is subordinate to the hard money first mortgage.

This appeared in a previous message a while back. I assume this can only be done when the house is free and clear?

THANX, BOB

import · May 25, 2000, 6:03pm

Re: Subordination - Posted by David Alexander

Posted by David Alexander on May 25, 2000 at 18:03:06:

Or when the loan underlying is less than the new one your putting in place.

I also like to make offer like 50k Now and 50k in 5 years.

That also has it’s advantages. Like a ton of cashflow during the waiting time.

David Alexander