Investor from Maryland

[Nordia Dixon]

Hi, I am Nordia. I have been real estate investing over 13 years now. I'm working now on taking it to a new level. I have the education and lender but I am needing a partner that has funding to assist with making new deals happen.

[Jay DeCima]

Nordiah

You have done fine so far without a parter.  Why change now?

Perhaps just change your idea of what to look for..........For 40+ years I have bought GROUPS of houses on a SINGLE PARCEL in Northern CA. These are always older, in the old parts of town or downtown, not suburbs. I usually pay about 10% down (about the same cash you would put down for a SFH in the burbs).

When you borrow money from banks to finance real estate, you’ll quickly discover that a group of rental houses and small apartments, properties with more than four units are a whole different kettle of fish than financing the home you live in! Mortgage money for investment properties is generally classified as commercial lending and most always comes at a much higher cost than residential loans. The reason is because bankers feel commercial loans are much more risky than a homeowner’s personal residence.

Seller financing happens when a property owner sells his property and agrees to carry back or finance the amount of the sale, less the amount received for a down payment. Say for example; he selling price is $100,000 and the down payment is $10,000. In this case, the seller would agree to finance the balance of the sale price, which equals $90,000. In other words, the seller substitutes himself in the place of a bank or some other institutional lender.

When you develop the skills to negotiate and purchase properties using this type of financing, you’ll be setting the stage for some very lucrative profits that the average investor doesn’t even know about. Not only will you place yourself in a position to earn future profits, but you’ll also enjoy a much safer investment strategy without any personal risk. That’s because seller financing is not really a loan! Not one penny of cash money is actually disbursed from the seller to you, the buyer. It’s really an extension of credit granted by the seller to facilitate his sale!

Should something go haywire and you find yourself unable to make the payments, and you default, the seller (lender) can take his property back, but that’s all! He cannot take other assets you own to satisfy the unpaid balance or deficiency.f Most bank lenders can come after everything you own to satisfy their mortgage debt because you are personally liable until it’s paid in full.

About the lucrative profits I mentioned above! Let’s take the $100,000 sale where the seller accepted $10,000 down and agreed to carry-back or finance $90,000. I would bet within 3 or 4 years after the sale when the balance is still close to $90,000…if you were to dangle $60,000 cash in front of the sellers nose, he would take this discounted amount in a New York minute. When he does, you’ve just made 30 grand. Believe me… you want seller financing!

Forget the partner......just beef up you education on something a little different. Research it.

Good luck.F

Fixer Jay DeCima