BP Podcast 272 Brandon and David

[Account Closed]

Currently watching BP podcast 272, Brandon and David talk about Seller Financing in part of the video.

David- mentions it and says something along the lines of offering 65% or 85% or 100% of the deal if you carry they note?

I am a little confused.

I do understand the seller becomes the bank instead of actually getting the loan from the bank.

My understanding, please correct me if i am wrong and add any advice or examples. (Lets use the 100% seller finance) Does that mean no down payment from me to the seller, and we come up with a seller finance monthly payment (seller's morgage)?

And from what David says, has long has i can get it to cash flow, then the deal it right.

I am passionate about learning this, please comment, mention, connect, inbox message me. I reply pretty quickly. I wake up at 6am, 4 hours before i have to leave for work to learn about this. Reading books, listening to podcast ect.

Thank you in advance!

[Matt Crusinberry]

@Account Closed, Hopefully this helps point you in the right direction. To give the most direct answer... Yes, you pay the seller a monthly payment. Now what is interesting about this strategy is that you are trying to get as much as you can, as far as terms, and the sky is the limit. There are several ways you can go about this, and I'm sure there are more that I am just not thinking of right now. I'm sure others here on BP would be able to give you some other ideas as well.

One is a "land contract" (at least that's what it's called in OH and PA), which you are essentially paying off the price of the home (i.e. 100k home you pay 1k a mo, 1k x 12 = 12k, 12k - 100k= 88k left after 1st year). This can be done for any amount of time (e.g. 5 years or 100 months, or whatever you can negotiate). They could ask you for a type of balloon payment at the end of 2 years (or as many years as you can get, to include 100 mo.), where you pay 1k for 24 months, and at the end of 24 months you pay house off in full. Again, whatever you're able to talk them into based off of their situation or their needs. You're a problem solver...

You could also make them the bank and pay on the P&I (at set price) as if you took out a bank loan. This too may have a balloon like payment, or a set date where you pay it off at a set time (kind of like an arm). This usually comes with some sort of down payment, but anything is negotiable.

You could also try to do a rent-to-own or option to buy contract where rent is a little bit more (sometimes), but after 3, 5, or 7 years you figure out a way to buy the house. This typically comes with an option to buy amount (we charge 3.5% down, so the people can have the down payment when they go to closing). You could essentially be doing this as a sub-lease to someone else while they do it to you. The 3.5% will go back to the end buyer (FHA loan) when they close at the end of the contract. You may want to consider if they own the property or if they currently have a mortgage on it (this applies to all the strategies). This is where the "due on sale" clause comes into play.

The hard part is finding the individual that is willing to do this, and you meeting their needs. There are other moving pieces in each of these strategies that I did not go into, but that need to be considered for each (i.e. do they have a mortgage, insurance, etc...). I recommend you continue to do your research. Again, you're a problem solver! I hope this helps and good luck!