IKE,
Sure they are out there, but it is too good to be true. They will buy notes from lousy credit buyers but you are going to get hit so hard on the discount it probably won’t be worth it.
The Note Buyers are going to want to see the credit and have a 1003 filled out. Any body that is advertising this is just trying to get business. It’s just like the car Dealers that advertise everybody is approved for a car loan. Well they are, but the terms and the down payment are whats going to approve them. The worse the credit the more they are going to want to see down. It’s the same way with the Note Business. If the credit is lousy they may want to see the buyer put alot down. They want the buyer to have risk or money involved too if they walk. You can also expect to have very low LTV’s with this type of buyer.
There is alot of flexibility in the Note business to structure deals but if you are going to target lousy credit buyers I wouldn’t waste your time unless you have alot of room on your deals. I find that Most people that have lousy credit don’t have any money to put down either.
The ideal situation for the Notes Deals are self employed or people with fair to decent credit that need a nodoc type of situation or income to debt may be a little high. They are easy to close and they are very quick and the discounts are minimul for this type of buyer.
Seasoning a note with this type of buyer may help if it is seasoned long enough but you still may want the terms set at a good enogh rate and lower LTV to get a decent buy rate.
Hello everybody,
Does anybody know of these note buying companies out there that advertises to realestate investors , claiming that you can sell your property for top dollar to anybody regardless of credit , within a short period of time ,usually in 2 to 4 weeks ? They claim that this can be done by creating a note ( to there specifications ) and selling this note to them in a simulteneous closing in which the house is sold to the buyer , the note is created , the note is sold to the notebuying company (ALL AT THE SAME TIME ) ,there by cashing out your position and claiming your profits.
Question for all of you , is this to good to be true ? or is this one of those pie in the sky dreams ? From my previous studies of the discounted mortgage businees , I learned that one of the most important criteria that prospective note investors looked for in a note was “seasoning” ( also credit ). Is this no longer the case ? has anyone of you used this technique before ?
Your councel on this matter will be greatly appreciated.
THANKS.
Ike:
It is feasible to sell a property FAST using seller financing? Doe is work? Cans I sell to sub- prime buyers? Does the paper have to be seasoned? Absolutley, Yes, Yes & NO…
Understanding and using seller financng to move properties is just another tool for you have in your toolbox. Learning the ins and outs, tricks, tips, traps, of how to “tweak” paper is another story. It is a craft that is learned over time and not a get rick quick program. Just like learning how to buy property right, negotiate, finance, fix, flip, etc. These SKILLS are developed over time from use and from working with other skilled individuals who are associated with these niche markets.
The beauty of using a seller financed transaction to sell a property FAST and to work with sub standard buyesr is the tremendous amount of deal creativity and FLEXIBILITY that is allowed to make a deal happen.
Will you learn this overnight- Probably not BUT that does not mean you shouldn’t explore the possibiliites to structured deals in this fashion.