Sean Flanagan and Pre-Wholesaling?

Question

ANybody have experience with Sean Flanagan?  He has a Pre-Wholesaling program that sounds good.  Just doing my due diligence.

Thanks!

Ryan Befort · Answer

I cam across this the other day. Im a mortgage guy, so I found a couple flaws. Then I looked up land trusts. Seems like that may get around lender calling note due. My concern is, even if it changes ownership, the loan doesnt. So, the person gives up the property, you take over mortgage, but person who gave up mortgage still has the loan. Basically traps them in the loan still. They cant go buy another house possibly, or even a vehicle.

Seems like all the risk is for the owner, outside of not paying mtg.

But I dont know enough for solid opinion.

Seems like all the risk is for the owner, outside of not paying mtg.

But I dont know enough for solid opinion.

Ed Middlebrooks · Answer

I mean, it's just creative financing.  When you structure these things correctly then there should be little to no risk to the seller.  Here, I'll explain:1.) Basically traps them in the loan still: No it doesn't.  sure, the loan stays in the seller's name but it's being paid by the buyer.  Also, if there's equity (and right now there's almost ALWAYS equity) the seller gets a note on a wrap around mortgage (AITD) from the buyer.  This means the seller is holding paper that they can sell to a paper buyer.  Don't know where to find one?  I go to meetings weekly with a room full of people who have money to lend, buy sell and trade notes, even pool together notes and other assets to buy properties.

2.) Then I looked up land trusts. Seems like that may get around lender calling note due.: Sure, putting it in a trust helps because a bank looks at that as estate planning, but banks don't call notes due that are performing in these kinds of deals.  The reason is that there are so many bad debts from banks that performing notes make their numbers look good.  If a seller sells this way and the payment is being made and the seller knows all about the transaction as evidenced by the paperwork, then the bank will most likely leave it all alone.  If they do call the loan due (which I've heard of happening in maybe 3 cases out of 1,000) then the buyer can work with the bank while they line up a traditional buyer if needed or use cash reserves from other deals to cash it out if necessary.

3.) They cant go buy another house possibly, or even a vehicle.: Bullshevik! At closing I have my attorney draft a letter showing that the seller has a payment coming in equal to or greater than the one going out.  If it's wrap around financing then they've just turned their liability into an asset.  It's the same thing a landlord does when they buy a house and rent it out for a profit.  Sure, some banks when acquiring a loan might want a little seasoning on the note, but their DTI is changed for the better, not worse.

4.) Seems like all the risk is for the owner, outside of not paying mtg.: When I do these kinds of deals and there's a downpayment the seller requires to make it work, I always recommend a nervous seller simply put some of that money into an interest bearing, easy to get liquid access to, account.  This way if something in the deal breaks they have a few months of payments in an account while they take back posession and sale the property.

5,) Taking back posession.  This one you didn't mention but I add it here anyway.: My trust is paying the loan and the seller.  If I fail to make 3 full payments consecutively then as written in the trust, the trustee and beneficial interest will change back to the original seller automatically.  No foreclosure process, nothing to do except the seller might want to re-record the title so he's now showing as the trustee on public record but he doesn't have to.

These deals are awesome for everyone involved.  When I pay some interest on the loan I'm turning their house into a great asset.  Honestly, once you get your head around this you'll realize why the banks have all the big buildings in all the big cities.  They're robbing the sellers of the interest they could be collecting simply because they want a lump sum of money now.  You wouldn't pay a 10% penalty and taxes to cash out even a small 401K, but we've all been conditioned to do that with our houses when selling.  Selling through a realtor on the MLS for a 1 and done pay day is the LAST thing I'm going to do, and I'm only going to do it as a seller if i need to liquidate for one reason or another.  Make the seller the bank, give then interst on the note, they'll make more money selling that way than any other way they can sell it, and I have the numbers to prove it.

Ed MiddlebrooksFullPriceForYourHouse.com

Robert Dornbush · Answer

I'm honestly thinking about doing this myself. Is this thread 🧵 still active? I hope to hear something about Sean Flanagan. Tx in Advance, Bob

Steve Juba · Answer

No updates on this? He's been around long enough now for some reviews to be out---any advise much appr

Laura Baragiola · Answer

@Gordon Graham

Did you ever get any information? Sat his webinar this morning and curious if I should put out the $$$.

Sean Flanagan and Pre-Wholesaling?

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