Hello friends. I want to open to friends here who are mainly engaged in BUY AND HOLD, purchase for maintenance…
Hi there friends. I would like to open to members here who are primarily engaged in BUY AND HOLD, long-term maintenance acquisition and return-generating option, but in my opinion not understandable enough, not talked about enough, and a great option for generating long-term income with minimal headache and hassle.
I intend to cash in on property, improve and sell it in as short a time as possible, in LAND CONTRACT.
This is a well-known and well-known method of sale throughout the US where the buyer can not get a loan or mortgage from financiers and he basically tells you the owner, let's fund my purchase.
Methodology:
Closes a deal and signs a regular PA like any other deal, with the changes required for Land Context. In this agreement, the terms of purchase vary from what we buy in Greece to SALE BY LAND CONTRACT, and in the agreement there is an appendix that talks about terms of transaction, settlement board, interest rate, etc.
The deal basically starts with a down payment
Spread payments over several years that you have agreed to
Final payment
The loan you have given to the buyer (the amount of the transaction less the down payment) carries a high interest rate, which in our experience can be up to 8-10 per year.
The buyer, satisfied that he can get to the property without sources of financing
The sellers, we actually get a down payment (we brought home money), get a significant annual interest rate
Transfer all the responsibility to the buyer (he is responsible from the date of purchase for all expenses: insurance, property taxes, maintenance, etc.) and our income is free of expenses except collection and book management
And at the end we are supposed to get another significant amount.
The significant bonus
Approximately 50% of American buyers in Land Contract will not be able to complete the purchase. The property goes back through the land to your ownership.
Each state has its own laws, but these are the general rules.
Here's an example of a property we now sell in Land Context:
We bought and renovated a property including closing costs at $ 38000 in Metro Detroit.
During a neighboring renovation, we closed the Land Contract deal with us:
60000 $ purchase price
6000 $ down payment (a little low, we always prefer minimum 8000 $)
3 Years of fixed 800 $ payments consist of principal and interest
And at the last payment.
If the buyer meets the payment
After you complete the payments, she actually made us $ 75000 (approximately)
That means 37000 $ profit
About $ 38000 investment
Which means almost 100% in 3 years.
Pretty.
What are the disadvantages? :
- Determine the price of the property today and lose the feasibility of the increase in value
- Long sale money will come back to us more slowly than regular sales
- Messing with the buyer for several years, programming to get with him to court.
Advantages:
Money power works well here because of the high interest rates
Get a "rent" but without the expenses
Significant chance of repossessing the property during the period and reselling (all legal, of course)
Shortcut
America.
think about it.
America in colors just like that. Each area and its risks. We do deals like this. Many times the seller becomes the bank. Even though today things are much easier to receive funds from many sources, it's all a matter of numbers. Yesterday I explained the subject in detail about real estate in general and Philadelphia in particular to two members from the forum.
There are loads of such opportunities and lots of different things and in the next three years alone I think I see a lot of returning assets to the banks or sellers who are the banks. Again at the end of the day you do not have to see what the interest is what the bank what the product ifa product at the end of the day it is all about how much you have invested for how long and how much you received.
I'm from Florida, with us along with Iowa, Kansas, Oklahoma, South Dakota and Texas such a thing will not work because of the HOMESTEAD EXEMPTION…
It is very difficult for me to draw such options in such pink and pink colors in a post that most readers are not skilled and professional investors.
I agree that in Michigan it's a little more positive and in principle, it's enough that the buyer misses one payment and you can already start trying to take legal action against him but that's really not the case in all of the US.
The Appendix to the Contract As you called it, this is a complex piece of contract in itself and you need good professionals by your side.
If you have a big operation in the area then you already have Britiner professionals but if you need them for one deal it already looks different.
The difference in earnings is also a little different than what you mentioned.
This is not in comparison to your investment but in front of a regular sale in the free market and it already looks “a little” different.
It seems to me that you are too constructive on Buyer's Dipult. It doesn't really happen in reality. Only small percentages and there are considerable costs to the legal process of eviction and it also takes time where instead of getting a return you spend quite a bit of money.
In short, it really does not rule out, but not for enthusiasts and beginners.
Correct me if I did not understand correctly but you do “OWNER FINANCE WITH 10% DOWN J
What are the costs of an attorney and spirit, to accompany such a transaction for 3 years?
Correct me if I'm wrong - in tests of feasibility testing a regular sale option is preferable unless the property is returned to you or the sale price is lower.
I sent a message in details
In our area it is very difficult to determine market value. The difference between a renovated house and not renovated can be hundreds of percent, but it seems to me that a fair market is worth about 50-55 thousand renovated
Need more and spirit Britannier in such deals
What would be the expected selling price if you were selling at the end of the renovation?
Excellent, well done!!! In the end I buy the loans that do not pay.?