All Forum Posts by: Brian Kempler

Hey @Michael Carbonare, off the top of my head 1) Wendy Patton, 2) John Jackson, 3) John Schaub. A few more books without contracts too. 

#1 and #3 are 10+ years old. The John Jackson contracts look solid though. I may default to using them. The problem is that the below quote goes against what others advise on here:

12. OPTION CONSIDERATION: The non-refundable option consideration fee of $_________________ will apply in full to the purchase or towards funds to close at settlement.

People here say option consideration is not and can not be used as down payment for the purpose of obtaining a mortgage.

Also, on the sandwich option contract to the buyer there appears to be rent credit verbiage (although I'm not sure):

Landlord/Optionor agrees to credit the Tenant/Optionee with  the total amount of the agreed upon monthly contributions at any time during the lease term to be applied as funds towards closing (Seller Concession) for the Tenant/Optionee.

I think you said you don't mind rent credits. But man, so many on here do. I wish I had a strong source of truth on this. Maybe it's time to start paying for an investor lawyer's time!

Hi all, I've gone through a few outdated Sandwich Lease Option courses. I would like updated trainings relating to the following:

1. Structuring payment(s) for T/B to eventually use as a down payment on a mortgage

2. The mechanics of doing a single closing exit, as the middleman in a sandwich lease option. (I have a high level understanding of the lien method but want details).

Can anyone recommend a course for either of these? #1 in particular is a sore spot for me at the moment.

I've been thinking of contacting other wholesalers in my area for their wasted leads: Low/no equity, meh motivation. Only real criteria is A/B/C areas and no rural. I plan to do creative finance offers on them.

I was thinking of offering $20 per lead plus $500 per deal. Do you guys think that's fair, or way off the mark?

Hi Ned,

Sure thing:

https://www.biggerpockets.com/...

https://www.biggerpockets.com/...

Originally posted by @Alexander Gonzalez:

The other way is to get the seller to sell directly to the buyer and you put a lien on their home for the amount of your profit. All parties still get what they want, but it does take a little more creativity on your part. There are ways around most everything, when we use our creative minds. This last idea also helps with ―seasoning requirements set up by many lenders today.

https://www.biggerpockets.com/...

Originally posted by @Brian Gibbons:

To avoid a double close at a title company on a flip or a sandwich lease option, research a "reverse assignment" where you use a buyout agreement and put your profit on a 2nd or 3rd lien. Property closes and you get paid.

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Thanks for any feedback on this or the mechanical question of how this is actually implemented!

Thanks @John Underwood! i read a second book which went into more detail. Here's what it said:

1. The trust holds the deed. The beneficial interest 'benefits' from the trust.

2. The beneficial interest itself is personal property

3. A transfer of title can be made, unrecorded, by selling the beneficial interest

4. An installment sale of the beneficial interest can also be done. 

5. If the terms of the sale as written in the contract are  defaulted, the seller may exercise his repossessory right

6. Just like a defaulted car loan seizure (eviction) is the remedy, unlike for real property which would require foreclosure.

I don't think equitable interest plays a role, both books made it sound like the beneficial interest was the sole focus. I could be wrong though.

I'm reading "Get the Deed!" and the suggested strategy on underwater deals is to take it sub2 anyways, then try to negotiate down the loan principal balance and/or payment. Failing that, rent it on a long term lease option to wittle down the balance.

Do you guys believe loan acceleration risk goes up substantially by trying to negotiate down the debt as the new owner of the property? I'm not even sure the bank would talk to me in this instance -- the debt is still not mine. Maybe I'm missing a step. I don't think an Authorization to Release Information grants negotiation rights. Any guidance is welcome!

I've read a Land Trust book that said Land trusts sell or assign beneficial interest, which is personal property. Which means upon default of the sale you do not have to foreclosure, may may take non-judicial repossession.

Can anyone confirm if this means you could sell on owner financing and evict upon default with a land trust and proper agreement?

Let's say a distressed seller refuses a subject to offer but accepts a wrap mortgage at the same rate and payment as his own mortgage. So you are paying him (while holding title). And he is paying the mortgage despite moving onto a new home.

What if the seller just stops paying his mortgage in this case? Seems now the investor has a problem with the underlying loan going into default. 

Is there any way to protect against this? I would prefer to pay the lender directly but that defeats the purpose of the wrap mortgage I think.

I am looking into a method for cashing out as the (middle) investor in a sandwich lease option. It was discussed on this forum that you could record a lien on the property as an optionee. 

The lien amount is the spread between your and the tenant buyer's purchase price in the respective options. 

Then during a single close with the tenant buyer, the seller's sale proceeds are used to pay the lien and cash you out.

Can anyone point me in the right direction on how to record a lien? I know how to record a Memorandum of Option in the county I invest in, in Ohio. I have no experience making or recording liens. If this is something that should be done with an attorney I will, although if either can do it I would prefer to learn myself.

Thank you Ashish! Can you elaborate a bit more to help me understand the options at a high level?