Note Holder Wants A Lump Sum: What Should I Offer???

[Will Gaston]

All:

I've got a seller-financed note holder that says she is interested in taking a lump sum. I have incredibly good terms so it'll have to be a great deal for me to want to do it, but I'm open for the right discount. 

Here's what I've got:

*Approximately $72,000 Balance

*30 Year Amortization

*15 Year Balloon

*1% Interest 

*Monthly Payment of $234 ($60 of which is interest).

Any suggestions on how to calculate or negotiate this? Is asking for 50% off too much? Or too little?

[Jay Hinrichs]

that note is next to worthless.. would not entertain paying off a 1% note early unless the discount was as you stated some thing very large.  run it through a PV calc and see what the PV is I think you will be shocked.. say your a note buyer and you want to make a modest 8% return on it.