Tips from Brian Gibbons re: Creative Financing

[Brian Gibbons]

It is the spring and I thought I would give a primer on "creative financing" for the BP community.

I will break it up into Beginner and Advanced.

I will talk about well known and not so well known strategies.

Beginner strategies includes bank financing, hard money and private lender financing, as well as installment sales, land contracts, lease options to buy-control, sub2, land trusts, option to purchase flipping, sale and purchase contract flipping, wrap around mortgage-AITD purchases, self-directed IRAs, Joint Venture Partnerships w LLCs, and others.

Advanced strategies include JVs with Sellers, pooling private funds, syndications and more.

Lastly some legal issues regarding Dodd Frank, CFPB regulation, illegal flipping, and other issues.

I will visit this post page every day for as long as it takes to go over these creative financing strategy issues.

` Brian

[Brian Gibbons]

B3. Sub2

Loan is taken "subject to existing financing".  Wow!  lots of words.

Say you have a $100K FMV, loan is good fixed rate, balance is $90K fixed, 3 months behind, no good solution to cure the note (make up back payments.

You come in and they agree you take over payments and make up back 3 mo.  Nothing down besides the back payments.

I have talked alot about quickly getting the original ($90K) loan paid off and not doing a buy and hold or a lease option exit or a wrap exit.  Improve the value, and resell it.  Make a small profit and move on!

@Jay Hinrichs and I agree with this: use Sub2 cautiously.  Quickly pay it off.