Owner Financing backed by Deed

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Owner Financing backed by Deed

Amby Bhagtani
Member since 2022 · 119 posts · 52 votes

I recently heard from someone who has been cashflowing using the following method:

1. Buys properties in mid-west between 30-50k in CASH

2. Owner finances them - and makes anywhere between 600-900 per month on the payments including interest

3. The best part is that he still owns the deed for these properties. 

Anyone with experience followed this model before?

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  • Account Closed
    Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
    3y
    Quote from @Amby Bhagtani:

    I recently heard from someone who has been cashflowing using the following method:

    1. Buys properties in mid-west between 30-50k in CASH

    2. Owner finances them - and makes anywhere between 600-900 per month on the payments including interest

    3. The best part is that he still owns the deed for these properties. 

    Anyone with experience followed this model before?

    So, if I'm understanding you correctly, you are trying to explain what I actually do and teach. Take a look at 

    https://www.biggerpockets.com/forums/311/topics/1141313-subject-to-why-you-need-money-to-buy-using-subject-to-subto-safely-legally

    and if that is what you mean, send me a DM and I'll explain.
    0Reply
  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    3y

    @Amby Bhagtani

    Sounds like buying properties via cash and selling by contract for deed. Yes you still have the deed but it creates problems for example when they don’t cut the grass now you get fined.

    Many states have adjusted the laws whereas you now still have to foreclose vs go through a forfeiture.

    Contract for deeds were great 5-10 years ago but states caught up with many of the laws to treat them like traditional mortgages

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  • Amby Bhagtani
    OP
    Member since 2022 · 119 posts · 52 votes
    3y
    Quote from @Chris Seveney:

    @Amby Bhagtani

    Sounds like buying properties via cash and selling by contract for deed. Yes you still have the deed but it creates problems for example when they don’t cut the grass now you get fined.

    Many states have adjusted the laws whereas you now still have to foreclose vs go through a forfeiture.

    Contract for deeds were great 5-10 years ago but states caught up with many of the laws to treat them like traditional mortgages


    Thanks Chris, why would I have to foreclose, I could just wait for the next buyer since I own the deed. Good point about the grass plus fines. 

    0Reply
  • Amby Bhagtani
    OP
    Member since 2022 · 119 posts · 52 votes
    3y
    Quote from @Account Closed:
    Quote from @Amby Bhagtani:

    I recently heard from someone who has been cashflowing using the following method:

    1. Buys properties in mid-west between 30-50k in CASH

    2. Owner finances them - and makes anywhere between 600-900 per month on the payments including interest

    3. The best part is that he still owns the deed for these properties. 

    Anyone with experience followed this model before?

    So, if I'm understanding you correctly, you are trying to explain what I actually do and teach. Take a look at 

    https://www.biggerpockets.com/forums/311/topics/1141313-subject-to-why-you-need-money-to-buy-using-subject-to-subto-safely-legally

    and if that is what you mean, send me a DM and I'll explain.
    Thanks Mike. Not quite or perhaps I don't understand your model. In my model I am buying descent properties in cash not making any repairs to them and seller financing them
    0Reply
  • Account Closed
    Investor · Scottsdale Austin Tuktoyaktuk · Member since 2021 · 4k+ posts · 4k+ votes
    3y
    Quote from @Amby Bhagtani:
    Quote from @Account Closed:
    Quote from @Amby Bhagtani:

    I recently heard from someone who has been cashflowing using the following method:

    1. Buys properties in mid-west between 30-50k in CASH

    2. Owner finances them - and makes anywhere between 600-900 per month on the payments including interest

    3. The best part is that he still owns the deed for these properties. 

    Anyone with experience followed this model before?

    So, if I'm understanding you correctly, you are trying to explain what I actually do and teach. Take a look at 

    https://www.biggerpockets.com/forums/311/topics/1141313-subject-to-why-you-need-money-to-buy-using-subject-to-subto-safely-legally

    and if that is what you mean, send me a DM and I'll explain.
    Thanks Mike. Not quite or perhaps I don't understand your model. In my model I am buying descent properties in cash not making any repairs to them and seller financing them
    Therein is the difference. You pay cash, I take over the existing mortgage.

    I sell on lease option though since it allows more flexibility.
    0Reply
  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    3y
    Quote from @Amby Bhagtani:

    Thanks Chris, why would I have to foreclose, I could just wait for the next buyer since I own the deed. Good point about the grass plus fines. 


     just because you have the deed does not mean that you can do what you want. if you enter into a contract (contract for deed / land contract) you cannot just evict a borrower if they stop paying. They have an equitable interest in the property and you have to follow state laws.

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