Should Note Holders Be Scared Of 'Walk-Away's?"

[Patrick Karbon]

Hello All!

I don't know if this is a Market-Place question but I had a fellow investor express his concerns about selling his homes on Land Contract so I'd like to pose the question here, using our terms: Does our model have enough Reward vs Risk against Walkaways?

Most of our homes on LC can be paid off about 10yrs or less. I can provide an example LC if requested but our basic requirements are:

-10% Minimum Downpayment
-9.9% Interest Rate
-Avg $650/Month Payment:
Principle+Interest Payments Only (Buyer's are responsible for Prop. Taxes+Insurance (We audit regularly to make sure home is insured)
-Proof of Income+Ability to cover entire PITI and still survive!
-Poor Credit is fine (so far) as downpayment has helped minimize risk of forfeiture.
-Homes are Priced at comparative Retail Sold Prices (within last 12 months)
-No Balloon's/ No Pre-Payment Penalties/ Fixed Interest Rate

I hope I can get some feedback or if other Noteholders here have run into buyers abandoning a home even though they put down a sizeable downpayment please feel free to share.

Thank you,
Patrick K