Selling Expensive Over 1 million dollar Homes With Notes

See my blog California Seller Financing here.

I create notes and market them for sale, so contact me!

Here is a 1.5 million house example of what I do:

Free and clear 1.5 mil
House appraises for $1.25
Tried to sell w Agent
Best offer 900K cash BEFORE the friggin commission!
Seller is pissed off, hates agents now

I come in at the point of expired
I explain it is not the Agent's fault
It is the Bank's fault
You need to Help the Buyer Buy or take the hit
Help the buyer buy and make 8% on the seller financed notes, or take a 30% or more hit ($450,000), with the sales commission.

"I will show you how to preserve your equity, and make 8%, with assurances and protections if there is a default, but you must learn how to help the buyer buy, Mr and Mrs Seller, AND preserve your hard earned equity."

I show the Sellers the traditional sales process, the agent puts the asking price into the listing - MLS, and then Price Reductions to "meet the market".   "This is what the market is prepared to pay for your house", the Agent is trained to say.

Well, the Agent has not been trained in Seller Financing Notes!

I show the Sellers these numbers:

20% Down, some "just missed qualifying" Buyer-borrower is willing to put down
$300K cash
(3% Agents' commission comes out of that, with a note broker's fee of 1%).

The expertise comes in with:

- Drafting the notes (1st and 2nd mortgs -  TDs) for a partial sale of the 1st (front end).
- Selling the notes to a note buyer (note buyer buys say 57 payments of the front end of the 1st for $300K payout)
- Seasoning of the payor is generally 6 months of buyer
- SAFE Act is followed as far as underwiting the Buyer (TIL, RESPA, etc).

Every one is happy here:

- Seller: gets 1.5 mil for the house, gets 8% interest on both notes,  $300K cash now, $300K cash in 6 months, small second mortg TD cash flow, big first mortg TD cash flow resumes after 57 payments, avoids vacancy, closes in 8 weeks with some certainty, taxation as per Section 457 of the IRS Code.

Agent: gets 3% payday after finding an Owner Fianncing Buyer (20% down)

Note Broker gets 1% and any other consulting fee.

Home Buyer gets a no hassle, low points, low fees Private Financing Home Loan.

In California, we use Title Holding Trusts (Land Trust cousin) and Delayed Sales Trusts as additional Estate Planning Tools.

There is more info on my blog here on Bigger Pockets re: selling expensive homes with notes as a note creator - note broker. http://www.biggerpockets.com/blogs/3/blog_posts/7475

Brian