Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
A seller is looking at doing owner financing.I would be wrapping his note.
Property insurance is not escrowed so that causes fewer issues.
Sellers main concern is that we owner finance and in say 3 years I get tired and just give the property back to him.I am putting nothing down which he is fine with.
Looking for thoughts and ways to make him feel comfortable with this issue.He owns other classes of assets besides apartments and is focused on them.
I already own a bunch of other buildings in the area and told him I have staff on site so it wouldn't be an issue.This is for a quad building.
Many investors buy with one thing in mind and then sell to you down the road for other reasons.Since I am a commercial broker I have multiple exit strategies already planned out for the property.
Developer · Cedar Rapids, IA · Member since 2009 · 97 posts · 42 votes
14y
Just went through this with a Duplex and owner had same concerns. One of his ideas was to break the loan into somewhat 2 loans: The first being a % of the Down Pmt that is personally guaranteed and will be paid off first giving owner the 'skin' in the game so to speak...Its all wrapped into one but a small portion is personally guaranteed.
He said he didn't need money down either but when you get down to it, putting a little down solves the problem. We ended up putting a small amount down ($5k)to satisfy this concern...after we negotiated 3.5% more off asking price of course.
I also think it really comes down to how you sell yourself. Ask if this is his only concern...then empathize with him, tell him you understand where he's coming from and then give him reasons why you will not walk away: Yrs in business, territory, type of person you are, ect.
