Real Estate Investor · NY · Member since 2008 · 313 posts · 87 votes
How do you all find homes that the owner will finance? I have run a few ads looign for homes and have called on for sale ads but the majority of owners will not finance, or will only finance for 5 yrs tops. I do have some cash on hand (20k) but I am in no rush to purchase and I want to do so using as little of my funds as possiable. I could get a convential loan, but I prefer to find owner financed homes if possiable. Thanks
Thanks for the quick reply. Any idea where I can find a List Broker? I cant seem to locate what I am looking for with google. Also, is it possible to purchase w/ owner financing though a RE agent? If so how would that work? I am guessing that I would have to give a large down payment to cover the agents fees. Thanks for the help
I am a newbie but this type of financing definatly sounds interesting since you have no loan in your name, but would you really want the owner to finance the property for longer than 5 years? I would think that if you could get the owner to finance for say 5 years then in 5 years you should be able to REFI and payout a balloon payment at the end of the term. Anybodys response would be greatly appreciated.
Like I said I am pretty new to REI and I have a little knowledge of it but how exactly would a Sub-2 deal work out anyways if you are going to rent out the property?
Are you looking for investment property and what is your exit strategy?
If you do not want to use all of your own cash, you can do a joint venture but will need to give consideration such as a percentage of the net proceeds to your partner upon sale of the property.
I have used joint ventures to buy auctioned reo properties. It is a good instrument to use for certain types of investments.
Research your options and always consult your tax attorney/accountant.
How do you all find homes that the owner will finance? I have run a few ads looign for homes and have called on for sale ads but the majority of owners will not finance, or will only finance for 5 yrs tops. I do have some cash on hand (20k) but I am in no rush to purchase and I want to do so using as little of my funds as possiable. I could get a convential loan, but I prefer to find owner financed homes if possiable. Thanks
Personally, I flip properties (not wholesaling) without ever taking title to them or doing any fixup or rehabbing. I used to find them, fix them, flip them and then forget them. And where possible, I skipped step 2.
It is so much easier to flip them without taking title (no, not assignments either).
Personally, I flip properties (not wholesaling) without ever taking title to them or doing any fixup or rehabbing. I used to find them, fix them, flip them and then forget them. And where possible, I skipped step 2.
It is so much easier to flip them without taking title (no, not assignments either).
Larry
Could you elaborate a little on what exactly you do? I am kind of confused. If you are not wholesaling them or taking title to them, then how are you able to flip them.
Let's say the FMV is $150,000, I send people to my website to answer a few questions. In about 95% of all cases, it builds in an automatic discount without me ever having to negotiate.
Now let's say the seller will take $110,000 (they are out there). The house needs no rehabbing or fixup (if it did, I do not buy).
I then begin to market the property and then if their is enough of an equity spread, I will offer the new temporary owner financing which will lend to buyers with credit scores as low as 500 (it is opening up to investors this week). Once my end buyer is approved (looks like that will soon be within 2 days instead of 3), I put the seller and my end buyer together and let them go to closing. So, at that point I am pulling myself out of the equation, using this patented method, I am assured that the title company will pay me my $40,000 profit.
Unless it is a local property, I never see the house, the seller or my end buyer.
So, you said no assignments. And, clearly its not a double close. Options, maybe? How about telling us? If its patented, then you're protected against someone else doing it. So 'splain it to us, Lucy.
Let's say the FMV is $150,000, I send people to my website to answer a few questions. In about 95% of all cases, it builds in an automatic discount without me ever having to negotiate.
Now let's say the seller will take $110,000 (they are out there). The house needs no rehabbing or fixup (if it did, I do not buy).
I then begin to market the property and then if their is enough of an equity spread, I will offer the new temporary owner financing which will lend to buyers with credit scores as low as 500 (it is opening up to investors this week). Once my end buyer is approved (looks like that will soon be within 2 days instead of 3), I put the seller and my end buyer together and let them go to closing. So, at that point I am pulling myself out of the equation, using this patented method, I am assured that the title company will pay me my $40,000 profit.
Unless it is a local property, I never see the house, the seller or my end buyer.
Larry Potter
So, if I have your 'method' correct, you must find a seller who is willing to sell at less than FMV and hold owner financing and be okay with you telling them that you are no longer buying but some guy with a 530 credit score is buying and they must be okay with seeing you make $40k at the closing table. And I'm sure you know they do see it because since you never hold any title you are never really present at the closing table so it's just the two parties looking at each other like "why do we need this guy?". And you must find a buyer before your contract runs up with the seller. Sounds like these are a lot of pieces that must come together, but if you can make it happen, more power to ya.
If your buyer brings their own financing it would be difficult because banks don't like names on the HUD that are not the seller or the buyer or the RE agent. I don't think they would be too happy loaning $40k to some line item on the HUD.
It sounds like what you do pretty similar to what a RE agent does.
This is actually easier then you make it out to be. Don't confuse what a Realtor does and this type of investing. Much if RE investing is about control. Just ask Donald Trump! :) I understand wallman's approach and use ia similar approach. You don't have to be a super investor to put together deals this way. There are plenty of sellers willing to sell less than FMV regardless of your area. Plenty of buyers locked out of financing. Being an answer to one of the biggest problems to hit real estate in the last 10 years doesn't make you a Realtor, it makes you a Rainmaker!
Cheers!
Sure there are sellers that want to sell less than FMV, doesn't mean most of them are going to hold a note and be okay with the multiple other things that must come together to make this happen.
i'm not saying it can't be done, it just seems like a lot of things that need to fall into place.
Go to a list broker and purchase "free and clear" lists. These people are very likely to do owner financing.
I can't seem to find "free and clear lists". I've gone through mortgage sections on various sites, but I can figure out how to find owners with no mortgage. Any direction?
Sounds like simultaneous closings. I was just talking to one of my friends at the title company.....Transactions where A sells to B who sells to C. Then the loan generated by C pays A and B.....these deals are pretty much gone.
**As for lists***PM me***
I'll show you where to get lists if you need them.
[Also, is it possible to purchase w/ owner financing though a RE agent? If so how would that work?]
I make it regular practice to teach my sellers about seller carry options and find out what their bottom line is for downpayments, who can more easily carry for a buyer as opposed to massive downpayments. I have many seller carry listings.
I do all the contractual agreements for seller carry. In Arizona agents can do much more than in states that need lawyers to handle transactions. An advantage that I see to this is my ability to negotiate all of the aspects of the sale. There is quite a range of negotiating ability with seller carry......but yes, I do expect to get paid, and there is a lack of "no money down" loans out there, so if all you have to pay are commissions and closing costs isn't that a good gig?
Lists? i don;t know where to find them, I'd try googling with seller carry included.....I put "seller carry" content into my listings in hopes that it picks up keyword relevence.