Seller Finance Your Assignment Fee

[Adam Schneider]

Sometimes you'll run into a situation where you want to assign a property but the end buyer is tight on cash to cover the purchase, the repairs, and the assignment fee. Consider seller financing some or all of the assignment fee. The more seller financing you provide, the larger an assignment fee you can command. I can hear the naysayers now…default risk, default risk, default risk. Three response thoughts:

1. Have a lien on the property as part of the deal.

2. Do your credit eval like you would with any part of real estate

3. Live life on the edge for once, will ya!!

Here's an example of one I recently did with a buyer who cleans houses for a living, and wanted the property I assigned so her sister's daughter would have a place to live. I had the property under contract for $30K, and wanted to assign it for $15K. She only had enough to cover the $30K plus reserves for the rehab. We agreed to a 12 month note to cover the $15K plus interest, to be paid monthly. I have a DT on the house, and I received two references from her--one of whom happens to randomly be a closing attorney I do business with in the area. She hasn't missed a single payment (so far). 

Your thoughts?

[Rodney Williams]

Great idea!!! 

Just get a note with the mortgage and in this case place a first position lien on the property and don't forget to record the mortgage at the Court House.

Good job.

P.S. Put the note in a safe fire proof place as this does not get recorded and since you are not a Big Bank you will need it to collect if the need ever arises.