All Forum Posts by: Dee Xixi

Wayne, I have no issues to sign a promissory notes. However the seller is asking for collateral. Seller wrote " The buyer must produce some form of unencumbered personal assets to guarantee the loan amount."

@Michael, for repair and unforseen expense. I can certainly front the cost. I do have other deals where I partner up that bring me cash. Quite frankly, I am so high on the deal is because thus far I co-owned 32 other units, I want to have a deal that it is all mine. Granted this deal has a good enough cash flow and the value is there.

Michael, agreed. It looks like a good a good deal for area mist investors are buying at 15 cap. Still not bad if the seller carry 40k. My biggest hurdle is, want the note to be personal guarantee

Didnt mention, he has this listing for sale for over 2.5 years

Hi All,
Please help me determine if this deal is a work away or at least a decent one.

Purchase price: $255,000
Rehab: 0
Total Expenses: $21,657
Total Income with 10% Vacancy: $49,680
Seller will carry: $40,000 at 9% for 3years.

However the seller condition is a bit wacky if you ask me. Read his email below. Any advise on counter offer sellers email.

Sellers email

The sale price is $255,000.00. The second mortgage amount of $40,000.00 must be secured with another instrument other than the property. If the bank has first position, I do not have any protection in the event of a default. The buyer must produce some form of unencumbered personal assets to guarantee the loan amount. The buyer noted in an email below that he will "personally guarantee the seller note." I would like to know how he plans to do this. I do not plan to take any risks in this transaction.

In addition, the terms for the second loan is for three (3) years at 9% which should include mortgage and interest. I am not interested in an "interest only" arrangement. There will be a pre-payment penalty (a percentage agreed upon between seller and buyer) if the loan is paid-in-full before the three year term. Also, I will not be using a broker in this sale. There has been no communication between me and the buyer's broker. All discussions to date have been between Donald and me. Any broker fees will be the responsibility of the buyer. Finally, the buyer has agreed to purchase this property "as is" with no provisions for the seller to further improve the property.

I guess need more help than I thought. Can anyone help me please structure this owner carry second.

Here is the number and scenario.

Purchase price: $255,000
Unit : 7 units
Bedroom: 5 ( 2 Bedroom) and 2 ( 1 bedroom)
Occupancy: 6 out of 7 in the last 6 months
Income: $55,200
Total Expenses $21,657
Expenses as % of GOI 39%

According to the local lender, 80% of the appraisal or 205,000 for a first loan. they are comfortable that seller carry second as soon as 1st and 2nd does not exceedi 95% of the value.

Seller agreed to carry 45k for 36 month @ 9%. But want personal guarantee. I suggest instead that carry second to create a promisory note to the purchase LLC

So now i need to structure this to present to the seller, any advice on how to sound professional, clean and convinceable.

@Bill,
Total purchase price : 267k
1 st mortgage: 205k
Seller carry second: 45k
I come up with 17k.

This is not my first deal but every other investments are with partners. Therefore it is a dilemma for me to give him an interest in an other property.

I found a great property with good income but bad cap rate for the location. Current owner over spent to rehab the small multi. The area is a c area but owner rehab for a area.

Listed for sale for over 18 months, over priced. For over year seller and I have been going back and forth. Finally I ask seller to carry a note for 20% of the purchase price. The seller agrees but his partner (the wife), is not on board with the idea. Does anyone have any suggestion how make the second mortgage secure either insure it or something. The partner issues is that they used their saving affraid that I dont keep my promess t and they lose everything.

Scott, three of them I got a finder fee. I find the hard money but to come up with the down payment.

Will I am agreed with all your all points. I just been losing so many deals. It is more like a desperate move.

I am looking for potential investor/ lender