Financing and Credit

JButcher posted this question and this is an abridged answer. It means selling a home to a buyer that does not really qualify for the loan (subprime loans for example) and giving them payments which they can only afford for a short time (the ARMS) and knowing full well they would more than likely get foreclosed on at a later date (like when the ARMs come due) like whats going on now.

HOME OWNERSHIP EQUITY PROTECTION ACT OF 1994

Sorry, this should hav ebeen posted here......

Hey everyone, my name is Ben and in just one week I have found two great houses by FSBO, in the nicest neighborhood in my area at great deals. Both are very motivated sellers and really really want to get out of their houses. I could buy both of these houses and have positive cash flow but I was wondering what avenue of financing I should take. Dean, I know you watch these boards and your a finance wizard - any ideas on what I should do? The following is the email I sent to CBR....

CBR,

Would anyone recommend letting a Real Estate Mgmt company help with the sell of their home such as my situation, probably going to do a owner finance and or lease purchase. Never completed one before . I called a RE.Mgmt comp this morning and he wants to come out and talk to me about handling my property for a small fee. I feel better maybe to let someone like this manage my property as far as security and make sure nothing goes wrong. Are their any downfalls other then having to pay them? I have money to pay them, thats not a problem at all.

I wanted to post a new forum about owner financing and lease with option to purchase. Which one is better for the aspect of making the most money and everything else involved in these two options?

Let's assume you get a seller to do seller financing (act as the bank).

You can get the seller to sell you the note your paying on at a discount or in other words take a discounted payoff. This would mean you would purchase the property for less if the seller would take a discount.

I seek a discounted cash pay off (whether it's my money or the banks) everytime I do seller financing. The seller may take the pay off because they are sick of handling month to month payments. Also, if the seller does not take the discounted payoff now they may later so I would keep trying.

I recently found a home but can not quilify for the amount there asking.I am a first time buyer. Is there any other way i can get financing for this property. I also need extra money to fix it up it has alot of potential to make good profit.

Can anyone help me to understand page 183 of Be a Real Estate Millionaire?

4th line from the bottom of the page;

Does this simply mean that you are asking the seller to mortgage his/her house again?
If so, isn't that a bit drastic?
What seller would do that?

I am having head spins just trying to understand all this!

I already have a mortgage and also carry a lot of debt. I want to buy a condo that is way under value and I want to rent it out. My question is, how do I qualify for the financing since I already carry so much debt. Am I better off putting a 60 day offer on the condo and then try to find an investor or buyer to buy it from me at a higher price?

Does your rental cash flow?

I was figuring out an offer to put in on this one prop. to make sure that the rent would cover my expenses and then some....

Then I got to thinking...hell, that is always going to be my offer on EVERY house that rents for this perticular amount!

(This particular house can rent for 1200. So I can't have a mortgage for anymore than 140k @ 5.75%.
PITI would be around 1100...cash flow of 100)

So anything over 170k with 30k down wouldn't be a deal!

see what I mean?
what do you think

Foreclosure auctions as you may know are hard to purchase for most beginning investors. In addition to all the due diligence that should be done on the property we need to find a financer that can close within a very short timeline. Some states require payment from an auction either at the auction, 24 hours later or a week or longer.

The fact is conventional financing cannot handle this kind of speed.