Posted by Todd (OH) on February 16, 2002 at 06:03:23:
Tim:
A) I am assuming from your post that you have acquired your 4-plexes using bank financing in your own name.
B) You did not sound like you were financially distressed to the point where your properties are inevitably headed to foreclosure.
C) If A & B are true, then you may want to avoid having your buyer “take over the payments”. This is a time-sensitive exit strategy used by motivated sellers who do not have better (i.e. more secure) options. You don’t want to jeopardize your nice credit score by putting it in the hands of someone else, if you don’t have to.
D) If you bought your 4-plexes with ASSUMABLE SELLER FINANCING, however, allowing someone to take over your payments might be a good idea.
E) A possible (although not glamorous) solution might be to buckle down, and improve your property managment skills to improve the cash flow. This will make it more attractive to a cash investor so that you can get your equity out in a cash sale.
Feel free to email me if you would like more specific info. I know what its like to own a multi-unit and wish you didn’t…
This is my first post. I need some ideas and or confirmation. I am deeply in dept, my wife and I both have credit scores of above 630, but our income to debt ratio is high and I want the monkey off my back so I can focus on my lease option business. I purchased two 4plexs and one two family home about a year or so ago + my own residence which I have had for three years now. The two family home is on lease with sec 8 and I plan to lease option it when the lease is up. But the 4 plexes are both hassles (like many I thought I wanted to be in the land lord business, but it?s not for me). Both 4 plexes have a mortgage of $100,000 and appraised for $125,000. They are not in the best of areas though.
I want to sell them on contract with $10,000 down and have the buyer take over payments. With the $20,000 I?ll pay off my debts (credit card) and focus on my leases option business. And my extra money can be used for advertising. How should I handle the sell, through a land trust or subject to? Which will benefit me the most? And how would you recommend advertising. I?m just curious how some of you would handle this situation; I am swimming in equity with no cash! Any thoughts would be appreciated.
This is a great site and I wish I had known about this before I started in REI.
Thanks in advance
I agree with Todd(OH)–you don’t need the hassles of somebody controlling your loans. I’d suggest you just one or both of the four-plexes in conventional fashion. The buyer(s) get new financing and pay off your loans.
You don’t need to use a real estate broker to list. Do it yourself.