How To Add Cash Flowing Rentals To Your Portfolio - No Bank Needed, Low Interest Rate

[Ken M.]

For 30 years I have practiced Creative Financing and it has been proven to work in all markets. Expensive markets like L.A. CA, OR, WA , NY moderate places like AZ, TX, IL, FL, GA, TN and inexpensive places like AL, MS, KY. In fact, it works anywhere in the USA. It's basically taking over the seller's financing, legally. Almost ALL loans & lenders have a Due On Sale Clause, which you need to know about. There is a protocol to follow.

Some kinds of Creative Financing include

1. Subject To (sometimes shortened to SubTo)

2. Selling Financing

3. Wrap

4. Lease Option

5. Contract for Deed

6. Land Trust

7. Short Sale

8. Private Financing

9. Hard Money Loans

10. Seller Carry Back

There are other creative financing avenues, but these are the "common" ones. I'd once traded a boat for property. I also have traded professional services for property. You can find "mix and matches" and each has it's advantages along with disadvantages. Some, you take title, some you wait awhile to get title. Having Title means the state recognizes you as the owner. Each state conducts these a little bit differently and it's important to know what is accepted in each circumstance. There is not a  master list by state and municipality. Laws change. It's important to get current information when dealing with creative finance. But, it's worth it. 

These can be used for "fix and flip", STR, Rentals, personal residence, 2nd homes, BRRRRR, MTR, Student Housing and/or whatever you use real estate for.

When contemplating doing creative finance, it's still highly recommend that you have a written Purchase and Sale Agreement, that you still order a Title Report and know what it's for and how to interpret it, don't do a closing in the seller's home, don't put the deal in a "Land Trust", do use Escrow, do record and do follow applicable state and federal laws. If you aren't being told about the Federal laws involved, flee that mentor. Lawsuits are expensive but unnecessary when business is conducted properly.

The item a lot of new investors miss, is the history of how that particular type of creative financing has been viewed and litigated locally. Anyone who mass teaches a concept and gives you the impression that it is acceptable everywhere, is "blowing smoke" to collect membership fees. No such thing exists. There is no "SubTo Insurance" There is no provision anywhere in the country that "deeding back  a property" gets you off the hook for violating the Due on Sale or violating the law. 

These above methods are effective, useful to both the buyer and the seller, but there are guidelines to follow. If you want more detail, let me know.