All Forum Posts by: Grace B.

looking for a note buyer. Have a owner financing property with 8% cap ROI. 818 669 4496.

Thank you so much! You are right. High risks.  

I need to find another vehicle to invest the monthly cash flow. I bought the condo with my IRA money 4 yrs ago. Now I am selling the condo, the monthly goes into that same IRA account. I just have to figure out how to invest that $1070/m for the next 5 yrs. Buyer also said will pay down in chunks. I don't intent to sell the note for a discount. I do want to invest in another real estate as an inflation hedge and not just stock market, that's my thought.

Could you advice this Odd owner financing term? I have a highrise condo under contract. The buyer ask for owner financing because they are retired and difficult to get a loan and yet don't want to used up all cash. I am happy to owner financing, not needing money at this point of my life. They have perfect credit scores 830 and 790 ( I received the credit reports) (They are a retired couple 69 and 62 no children).  They also are living in the same building for many years. they want to buy several units for investments.  In a nutshell they are credit worthy. The current term is $184,900, 10% down, 7.75 %, 5 yr ballon, 30 yrs amor. It is scheduled to close at the end of month and title company is still getting the condo transfer doc ready. There are realtors on both sides. But I have good open communication with the buyers directly.

A crazy idea came to me today. I am still working, not needing monthly income, do you think it is ok to propose change the term to receive one payment at the end of the 5 years (say the 90% principle plus the interests compound yearly)?

This benefits them that there are no monthly payment, reduce their hassle of managing payments. Do you think I can justify that asking a little higher interest rate say 8%? Am I nickel and dime ?  This will be my retirement saving plan. (and try not to spend it yet)

Am I taking too much risk by not getting payments for 5 yrs .till the end? knowing they are getting the title from day one  and I get a promissory note? The only assurance are that 1. title company handles the transaction so it will be recorded 2. I know they have some financial base 3. They have good scores. and they have a unit in the building already. 4. I will get the 10% down to start with.

What do I need to look out for? What if they want to pre- paid a big chunk during the 5 yrs term? Do I need to give them incentive to let the loan stay unpaid till the end and let it generate interest for me?

Need advice as to how and why to sell this property by owner financing. I own this property for over 14 yrs. Bought with my IRA money in custodian. It has been used for Group home and it has been rented to group home operators, averaged 3-4 yrs at a time. The current tenant/operator (two women) signed a 5 yrs lease 6 months ago. The rent is $2500 + N. Tenant maintains the interior and lawn. Landlord the structure (roof and foundation). The neighborhood property price has gone up in recent years for about 30% and I am thinking about selling it on the market to investors (8.87% cap) but first I like to present it to the tenant/operator and offer owner financing and carry a note. There is no agent involved. I have done a couple of owner financing in the past and carried notes 5 yrs ago. have some experience. but not the dot frank law. I have no need of money so I am happy to carry for 3 yrs. They were interested but I have not presented the terms. Here are my planned terms. Selling price $279 900, 8% interest rate, 30 yr amort, 3 yr balloon at 10% down? The loan at 90% is $251.910, monthly at 8% is $1848.43. Property Tax is $337.5/m Insurance is $108.33/m total comes to $2294.26. That's buyer's monthly cost to own the property with owner financing which is lower than their monthly rent. .

 On top of that they will accumulate equity about $200/m in the first three years.  Their gain is my loss. I will have less income $426/m with owner financing during the three years of carrying it.

Do I really want to sell at this time? I am not sure. The only reason I can come up with is that I am planning to retire in 3 yrs. Thinking why not sell it now. On the other hand, this is a commercial lease and tenant is responsible for maintenance. I really should not need to worry about hang around being a landlord and I should wait for end of lease to sell and enjoy the cash flow for the time being.

Tenant has been planning to install fire system and sprinkler system which will cost them $30,000. Even when they know they can't take with them after 5 yrs. the lease didn't prohibit landlord selling the property during the 5 yrs. Lease doesn't guarantee it will be sold to tenant. Lease gave the tenant first rights of refusal to buy.

I based my selling price at 8.87% cap I think that is an attractive ROI at $279,900.

The property was built in 1984 and is in good condition interior and exterior. Roof and two ACs were 6 yrs old. foundation is sound and it's a brick house in a quiet neighborhood. The house has been a group home since it's been built.

Do I want to provide a COMP of the neighboring similar properties for investor or for my tenant? This is really unique situation, the residential properties near by has different use, therefore not good for comparables. or do I let them do their market research any way? Do I want to give them 2 weeks or one month to make decision before I put it on the market? Right now it is a good summer season to sell. 

Do I want to provide a COMP of the neighboring similar properties for investor or for my tenant? This is really unique situation, the residential properties near by has different use, therefore not good for comparables. or do I let them do their market research any way? Do I want to give them 2 weeks or one month to make decision before I put it on the market?

 I am not sure if they can come up with 10% down payment right a way especially they may need reserve money to install fire alarm equipment and fixture in the property for patients safety and code compliance in the next 3 months. They pay rent on time. Do I want to accept less than 10% down or how do I handle if they bark at 8% interest rate? If I accept lower than 10% down? Do I give them the title ? Do I offer 3 yr or 5 yr balloon? If 5 yr balloon can I stipulate increase rate 1% on the 4th year?

They have average credit scores. But they are hard working determined business women and they pay rent on time. Right now it is a good summer season to sell. Do I want to close at the title company or do I hire an attorney to draw up paper work. I don't plan on purchasing title insurance for the buyer. I will provide title report. Can you give me advice on how to sell/negotiate/present this property to my tenant/operator or Investors on the market? -Grace B. Dallas, TX

Interesting read above. I have an opposite situation.  My family has a group home property (one floor  6 bd 4 bath)  leased to a pair group home operators. who are two best friends got together to run a group home. One is a nurse.  Now in the fourth months, they have already 3 patients residendants and financially they are probably breaking even now. The rent is $2500 + N. They  maintain the interior and lawn. Landlord structure. The housing price has gone up in recent years in the area for about 30% and we are thinking about selling it on the market to investors (8.8% cap)or to the tenant/operator and carry a note. There is no agent involved. we have done a couple of owner financing in the past and carried  notes.  My question is how to present the finance terms to the operator. i mentioned verbally about the possibility of the family is considering selling now and also be willing to do owner financing. They were interested.  Should I just send them in email the terms of what our family wants for example, $279,900, 8% interest rate, 30 yr amort, 5 yr balloon at 10% down? And add an amortization table showing interest and equity table  ? Do I want to provide a COMP of the neighboring similar properties? or do I let them do their market research any way? Do I want to give them 2 weeks or one month to make decision before I put it on the market? I am not sure if they can come up with 10% down pay right a way especially they may need reserve money to install fire alarm equipment and fixture in the property for patients safety and code compliance instead.  How do I handle to resistance of 10% down or if they bark at  8% interest rate? Do I want to accept lower than 10% down?  since they have average credit scores.  But they are hard working determined business women and they pay rent on time.   I am not in a hurry or need money  just that I see right now it is a good summer season to sell.  Can you give me advice on how to sell/negotiate/present this property to my tenant/group home operator or Investors on the market? -Grace B.  Dallas, TX

I have a question: I am selling the property for $238,000. The buyer offered $200,000 with $6000 down and plan to finance $194,000. Also asked seller (me) to pay closing cost of $7,500. The bank pre-approval shown they qualified for $194,000. The offer is too low. I would like to counter $226,800 of which I will carry $34,300. That means receiving $192,500 (cash portion) and I will pay the commissions (both agents), and my portion of closing cost. 

Can you give me feedback if the numbers look right? 

In addition, since there will be negotiation for repairs after inspection. I probably need to counter, not $226,800 but $231,800 so to cover the repairs or rebates. The counter will be $231,800.... What do you think? I would really appreciate if you advice me how to counter and how the wording wo