BiggerPockets

I see it all the time. Either new investors or seasoned ones with properties they are selling 'Owner Financing' L/O or Rent2Own.

First the problem is in their true intentions. Most of these guys/gals are doing this for the 'option' money or 'down payment' money assuming or knowing that the 'buyer' will probably never follow through with it.

First Tip:
If you're going to advertise or place a tenant/buyer in the property, please be ready to actually sell the property. If not, you're really being a scumbag and you're going to end up putting losers in your properties (basically crap @ss tenants with a bigger down payment) and you're going to continuously have to repair the property after they leave.

Second Tip:
Have a list of Qualified tenant/buyers in a pool waiting for a phone call from you. Spend your time working with Realtors and Mortgage Brokers that market to buyers. Make sure they know that you're the 'owner financing' guy. This will be helpful if the buyer can't quite qualify for a mortgage but with a little bit of work on their credit, they'll be just fine. You can get these buyers in your property at a slight premium and know they are working towards getting traditional financing to cash you out. Realtors and Mortgage brokers come across this type of seller on a DAILY basis.

Third Tip:
Don't be a one man band. Your success really lies in the strength of your team. If you single handily found a seller, bought a property, fixed it up all by yourself and now you're ready to receive monthly interest payments/cashflow in the form of owner financing (of any kind like mentioned above) don't be surprised if you're not getting the response you expect.

I see this all the time, especially on Craigslist where a property has been listed for some length of time. You call them, they act all hot shot and wanna try to sell you (a smarter investor) the property higher than its worth retail and they have no idea why they're still sitting around with their thumbs up their ............fill in the blank.

You can get these premium prices if you know where to look. Realtors and Mortgage Brokers is the first and best place to search. Get your name in front of them. When you're buying these properties regardless of how you're getting them, know your exit strategy and have a plan in place.

Last tip...............I'm inviting you to participate. Gimme your best advice for those that sell Owner Financing to get their property filled fast and for a modest premium. Vote for the best answers and we'll see what great ideas we can come up with.

I'm pretty sure I read it on here one time, so I hope I'm not plegurizing. But someone said that they ran a "pick your neighbor campaign" putting door hangers or post it notes throughout the neighborhood, and offering a finders fee to anyone who could locate a buyer. Sounded like a pretty good idea to me.

I've done more seller financing deals than I can count. Back in the old days when I had fully assumable FHA/VA loans underlying I could run an ad that said; "Owner will finance with $1,000 down", and have my pick of buyers.

I never really liked doing CFDs or L/Os, particulary after Texas changed their laws, so I went back to doing straigh up SALES.

Selling places that I owned outright I could run an ad that said; "owner will finance for $2K (or whatever) down" and get my pick of buyers. I picked wrong on a few buyers and gotten several of them back. Generally through "moral suasion" but a couple of times by paying an attorney to conduct a Trustee's Sale.

There are two sides to any deal, PRICE and TERMS. I've found that when I offer great terms, that PRICE doesn't come up very often.

I do disagree with your third tip. I've generally been a one man band because I don't suffer fools gladly and don't like to split my profits with those not willing to work as hard as me. When I've bought right, done the work right, priced it right, sold it right and maximized my profit, all by being a one man band it's hard to argue against that strategy.

BTW, I always got lots of calls from (wannabe) investors who seeing my ad must have thought, "aha, a FSBO, it must be underpriced". I've generally been able to pick up on them during our initial conversation and told them that if they think this is a good buy for an investor THEY ARE WRONG. After all, why would I as an experienced investor leave money on the table for them?

Their general answer is; "oh, I probably know some tricks that you don't". To me that statement means that they DON'T. I tell them that if they are truly investors and decide to buy (at this point they haven't heard or read the price) then I will just raise the price or interest rate (which they also don't know yet) to a point where it isn't a good deal for them.

Frank