What do you think about this one? - Posted by mike

Posted by phil fernandez on March 01, 2001 at 09:23:27:

Hi Greg,

Not a dumb question at all. Cash to mortgage is the amount of cash you give your seller above the amount of the mortgage balance.

If you perhaps buy a property subject to the seller’s $50,000 mortgage and agree on a purchase price of $55,000. You would give the seller the $5,000 in cash and take his property subject to the $50,000 mortgage already in place. You have just bought a property with $5,000 cash to the mortgage.

What do you think about this one? - Posted by mike

Posted by mike on February 28, 2001 at 16:24:48:

I have a guy who just got divorced and wants to get rid of his house. it’s a two story frame home worth about $55k fixed up and needs about $5-7k in work. he has a first of just under $30k, he is asking $40k. what should i offer and how do i structure the deal (step by step) i’m a newby.

he has not indicated that he is credit conscious.

i have a couple of ideas:

  1. offer $1000 cash to mortgage and take the loan subject to. then wholesale it to an investor for $5000 cash to mortgage. or all cash.
  2. offer $20k cash and find an investor on a flip for a little more.

Re: What do you think about this one? - Posted by phil fernandez

Posted by phil fernandez on February 28, 2001 at 17:53:07:

Option #1 is viable and I’d go with that one. Your second option probably isn’t because he has a $30,000 mortgage, it’s doubtful that he’d sell it to you for $20,000 and come out of pocket for the remaining $10,000. Then again if you don’t make the offer you will never know. The offer that your seller will accept will be based on his degree of motivation.

Good luck

Re: What do you think about this one? - Posted by Greg NY

Posted by Greg NY on February 28, 2001 at 22:10:54:

Hi Phil,

This is going to be a dumb question but I have to ask, sorry.
What exactly is “cash to mortgage” and how does it work?

I should know this but i don’t know why I don’t. Thanks.

Greg NY