All Forum Posts by: Alan McCraney

Michael Rogers I was told by him that it would cost roughly $400 to get the deed and paperwork signed and to make it legal. I will find out more in a few days when I meet with him what all this includes. I will talk with him and see if I can get a standard amortization and possibly try and talk him down to a 5 or 5.5% interest rate. I will update as the process continues. Thanks for the help everyone.

Kelly N. Yes, that would be very true. I'm not sure what banks look at when acquiring for a new loan but would there be anything that would stand out on any tax form that may require for a future loan?

Jon Holdman He is a part owner with my father in a mobile home park and the duplex appraised for 180 but he wanted to help me get into duplexes instead of just mobile homes so we set a deal of 100k. He would make a good bit more off of the 6% doing it the way he wants. Do you personally think I would be better off getting an FHA loan at a much lower interest rate? Only requirement would then be that I live in one of the units.

Thanks Sam W.

Cash flow will definitely be key. Considering this will be my first property it will probably be best that I put back as much cash from the property as possible towards the beginning even though the duplex is in incredible shape and just had a 30 year commercial roof put on last year.

Wayne Brooks That's the way I thought conventional loans worked. However the way he explained the deal was he wanted the interest on each payment that year to stay static until the next year. It seems doing it his way would only lower the interest once per year and that interest on the payment would stay the same that year. Doing it that way would far benefit the amount he makes off of the interest. If this is true I know I will be much better off getting a bank loan.

Sam W. Thanks Sam. I am very new to investing and the only loans I have ever taken out were on a vehicle and of course the dreaded student loan. So maybe this is just a standard loan and nothing is different besides the interest amount not changing until the following year. It seems that would greatly benefit him by collecting extra interest.

Thanks Jon.

I am meeting with him to discuss this either this weekend or the first of the week so he can explain a little further in detail. From the way he explained it, it would go as follows:

100,000 at 6%

1st year (6% on 100k)
Monthly payments would be roughly 1,055 (555 principle + 500 interest)

2nd year (6% on 93,400)
Monthly payments would be roughly 1,022 (555 principle + 467 interest)

The interest for the next year would just be 6% on the principle and same for the next years.

At the moment I don't believe I am going to agree to this. He will still sell the property for 100k if I want to get other financing. The only plus side to doing the owner financing with him would be that I do not have to occupy one of the units. If I go and get an FHA loan I will need to occupy one of the units.

I am looking at purchasing a duplex for 100k. The seller is an older man and wants to do owner financing so that it will continue to give him income from the property and he will make a profit from it. However, the seller wants to charge a 6% interest rate which is very high for today's market. I am curious to know if anyone has experience with the way he wants to loan the money.

He wants to charge 6% per year on the amount that is owed that year. So lets say the first year I will pay interest on 100k. The following year lets say the loan is reduced to 90k, I will only pay interest on 90k.

Has anyone heard of this type of loan? I am new to investing and this will be my first property if I purchase it. Thanks for any help.

Thank you for the welcomes! I have been looking at duplexes/quadplexes here and I would live in one of the units. The only issue with the quadplex is that it only offers 2bd/2ba units and I need to do more research on how well 2bd/2ba rent in this area with so many military families.

Hello, I just stumbled upon this site while searching for information on duplexes. I am new to investing and thinking of starting with a duplex. I'll be around the forums a lot taking in as much as I can.