Full-Time Investor · Charlotte, NC · Member since 2009 · 2k+ posts · 1k+ votes
have a 4 unit property that i'm thinking of seller financing...price--145,000....terms would be 10% downpayment, 8.5% interest amortized over 25 years w/ 5 year balloon...any suggestions?? i get that at about 1,003/month payment...does this sound about right..or too nice? i don't want to screw someone into a deal where they will lose money...i'd like it to be profitable for them as well...then again, i need to make it worthwhile for me to hold the note..also, i've heard HUD is eliminating seller financing, but my attorney hadn't heard of this...am i good to go?? thanks
Real Estate Investor · NJ · Member since 2009 · 6 posts · 9 votes
16y
George, I have been trying to get in touch with you for months already for the return of "underwriting fee" you charged my investor upfront to get the loan "started". You had told my investor "the check is in the mail" over 2 months ago. The cell number I have for you seems to be disconnected, the promises you made to her about getting it funded and already having a lender were UNTRUE. As you verbally stated as well as written in email the upfront fee is refunded if you CANNOT come thru with lending source! Please contact me so we can arrange a refund for my investor that was promised the world and delivered no results. I am sure you will agree George, that is not good business.
Note Investor · Pasadena, CA · Member since 2009 · 849 posts · 544 votes
16y
10% down IS too nice.
Banks want 30% down for non-O/O.
Another hint: in the note business, there's a saying that 99% of balloons never get paid, just extended or modified.
If you want to fully protect yourself, as well as maximize the note's re-sale value should the need occur, here are some guidelines.
1. 20% down minimum.
2. 20 year amortization schedule as the maximum. NO BALLOONS.
3. Have the note serviced by a 3rd party. It will make life easier for all parties involved.
Full-Time Investor · Charlotte, NC · Member since 2009 · 2k+ posts · 1k+ votes
16y
thanks for the responses guys..my plan is to sell the note....what are performing notes going for these days if i have it seasoned a few months?? a year?? what about a simeltaneous close between buyer, me, and note purchaser?? can you recommend a 3rd party servicer??
Hard Money Lender · West Palm Beach, FL · Member since 2009 · 181 posts · 29 votes
16y
We have developed a private equity facility that discounts seller notes at closing. Up to 85% of face value available. Accepting most credit buyers. This may be a solution for you.
Real Estate Investor · Chattanooga, TN · Member since 2010 · 151 posts · 59 votes
16y
When you say "hud is eliminating seller financing" I'm guessing you are referring to the current legistlation that would limit the number of owner financed deals without a mortgage license. If this is your first deal, you should be ok.
Real Estate Investor · NJ · Member since 2009 · 6 posts · 9 votes
16y
George, I have been trying to get in touch with you for months already for the return of "underwriting fee" you charged my investor upfront to get the loan "started". You had told my investor "the check is in the mail" over 2 months ago. The cell number I have for you seems to be disconnected, the promises you made to her about getting it funded and already having a lender were UNTRUE. As you verbally stated as well as written in email the upfront fee is refunded if you CANNOT come thru with lending source! Please contact me so we can arrange a refund for my investor that was promised the world and delivered no results. I am sure you will agree George, that is not good business.
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
16y
Hi, first, the SAFE Act covers 1-4 family properties, not commercial loans. The CPFA will have a wide swath to cut, but it appears commercial loans by private individuals is not in the path.
If I were buying your note, I would pay more for the note if my yield were higher and able to reinvest that money. The best way to do that is to have a balloon payment in three to five years. So, in my opinon, your 5 year balloon is just right. Secondly, 9% is probably as easy to get as 8.5% and it will give you room to drop the rate if you need to to make the deal.
You really need to look into having the loan serviced, I've ritten about that here several times, it will provide verifications for refinancing as well as selling the note. Servicing takes care of many headaches and the buyer can pay the fee.
Solidreturns has they saying correct, but a note that has a balloon that can not be met is what????
It's a repricing opportunity! Maybe fees to redo the deal for the servicer, certainly the rate, you can shorten the amortization, take interest only, do just about anything you like, it's like new business. If the note had been paid, that money would be reinvested in other notes, please save me the trouble, allow me to modify the existing note and earn the fees and rates I would have under the new business. This is a commercial deal, all is fair in love and commercial deals! Good luck, Bill
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
16y
Oooops! Jon, I still owe you another point! Yes, it's 1-4 family so it is covered! Sorry, darn, that's the second mistake I've made...(LOL!)
What I said about repricing still applies, 8.5% is good at the residential rate, whatever is agreed. Get a mortgage originator to write it unless you are living in one of the units. Good luck, Bill
Full-Time Investor · Charlotte, NC · Member since 2009 · 2k+ posts · 1k+ votes
16y
hey guys, this thread has seen a nice revitalization, and i appreiate the feedback..i did end up selling for 139,000...10% down, 8.5 interest amortized over 30 years, but with the 5 year balloon..i am using cashflow services..thanks loc, they seem on top of things so far as this is the second note i am having them service..i've had some lowball offers for the note, and some somewhat decent offers...it may be better to hold on for a few months to a year and get better quotes on the note....but definitely a learning experience!! either way, i don't mind holding on for the cashflow--much easier than a rental, and you should see all the improvements the buyer has already made!!
bill, great tips on when the ballon comes due...thanks
george, sure do hope you clear all this up, especially since you've been emailing me trying to drum up some business...hopefully somewhere on this forum you can get everything sorted with dave if what he says is true...otherwise you wouldn't see a dime from me
Hard Money Lender · West Palm Beach, FL · Member since 2009 · 181 posts · 29 votes
16y
I was just made aware of this thread today.
Dave Bashir, my email address has always been in my profile and there was nothing preventing you from contacting me anytime. As you know there is always two sides to every story. If you wish to learn the facts just send me an email and I will respond immediately.
Dave Bashir, my email address has always been in my profile and there was nothing preventing you from contacting me anytime. As you know there is always two sides to every story. If you wish to learn the facts just send me an email and I will respond immediately.
The FACTS are that I also was charged $900 + expenses of sending funds to him under false promises. I was promised repeatedly I would receive a full refund on May 18th within 30 days. He's since changed his phone number and address, gone into hiding and removed all contact info from his Web site. Despite repeated claims that checks have been sent and wires, no money has ever been returned.
I have now filed a complaint with his precious BBB, and will be filing with the State's Attorney and the Office of Financial Regulation for his fraudulent activities.
Those are the facts, and I have the electronic backup to prove these statements. Draw your own conclusions.