My first seller financed deal profited $30k in 2 months!

[John Horner]

I've been wholesaling/flipping for about 18 months, and this is the first time a seller has taken me up on seller finance part of the purchase.

The property was fully rented triplex 5 blocks North of OSU campus, but rents were about half of going rates on the street.  The owner had mailed me a typed letter saying he was interested but wanted retail.  I looked at comps and at first turned him down because there were NO COMPS in the area.  People buy OSU rentals and never sell so I had such a hard time comping... until a triplex sold for $300k just 2 block south of this property.  This is when I knew we had something.

I quickly accepted and we were able to negotiation a purchase price of $170k and the seller was going to finance 60% ($102k) for us on a 7.5 year note with a 5 year balloon at 5% interest.  We came up with the $68k cash to close on the property and it was ours.

We listed it the day after closing and had 4 showings the first day and an offer of $285k.  We were ecstatic and counting our money... unfortunately the buyer was a novice and didn't know what the property was actually work.  He ended up backing out shortly after.

After about a month and many more showings, we ended up selling for a a net of $30k profit.

This deal was nothing out of the ordinary, all I did was ask for seller finance and the seller thought that 5% was a great return then he was going to get on a CD or in a bank account.

It never hurts to ask :)

[Larry Turowski]

@John Horner That's awesome!  Congrats!  I've never done an sub-to or owner finance, but I do ask on occasion.