Sell NOW if you want to… - Posted by Michael Morrongiello
Posted by Michael Morrongiello on April 03, 2000 at 22:52:14:
There is a big difference in evalutiing someone as a prospective buyer where they simply have NO credit established at all whatsoever OR an individual that has very No current credit trade accounts open and who may have some prior derogatories showing.
Assuming this is legimate lease option agreement that can be formally documented then with some sort of documentable proof that this tennant has paid the rent timely and if the rent amout payments would be commensurate with what a mortgage loan payment would be then this is a perfect opportunity to finance this sale yourself with a seller carry back note or notes (2). That 1st lien note then is converted into cash.
This may allow you to sell now rather than have to wait another year. However don’t expect a note funder or any lender for that matter to finance this type of No credit buyer at a 90% LTV threshold. You may have to participate in holding some of your equity in the form of a smaller 2nd lien and this might represent some of your profit to you.
Remember that not having the use of your cash for other investment opportunities that might come along because it is tied up into this property for another year is a COST to you as well and needs to be seriously weighed.
To your success,