All Forum Posts by: Stacey Paulin

Hello!

I'm working on a seller finance deal and I'm having trouble crunching numbers.

This is a 3/2 with a purchase price of 75,000. 5K down payment and terms are 5 annual payments of 14,000. No interest.

Rent: 900 - 1000 in the area, but I want to be conservative.

Taxes: 1000 per year

Insurance: 600 per year

PM: 7%

Repairs and Maintenance: 10%

Cap Ex: funded by savings acct. that we contribute to ourselves.

How would I analyze a deal like this where there is no monthly payment and no interest? The home needs cosmetic repairs of about 8K.

Thank you!

It sounds like a great seller finance deal.  The seller doesn't seem to be in a rush to capture all her equity at once, and the terms are great.  The home is in close proximity to you. That could be a good or bad thing depending on your level of involvement.  The returns sound great and there's opportunity to add value to the home.  I'd jump all over this deal.  Good luck!

This sounds like a strategy many folks are using.  I like the idea of using HELOCs for DM and financing since it is cheap and relatively easy to do.

Awesome!

Wow. Awesome deal!

Amazing numbers.  Congratulations!

@Mike Vann Excellent!  Thanks a lot.

@mike 

@Mike Vann Could you elaborate on "buying your properties right"? Do you mean distressed properties below market value? Are you essentially doing the BRRRR method? I'm trying to figure out how people are acquiring properties so quickly without using their own money. Could you do the same thing with a hard money loan?

We recently heard of Truth in Equity via another real estate podcast and were intrigued enough to do some research about them. Turns out you don't need to pay them the 3000 dollars to do this strategy. You need three things to make the strategy work: a line of credit, a decent credit score, and a decent amount of cash flow left over after your bills are paid. The more money you have left over after paying your bills, the faster you can pay down the HELOC balance after using it. Of course, this requires you to use the LOC as a checking account from which all bills are paid.

We are in the process of doing this. Our plan is tweaked as follows: obtain HELOC; pay down principal on our primary home with a lump sum payment from HELOC, dump all paychecks into HELOC account, use another credit card to pay all monthly expenses, then use HELOC to pay off credit card bill. In a few months, the HELOC balance is back to zero and the process is repeated.

There is a lot of information out there about this. I think it can be done, though, independent of the mortgage accelerator company if you can find a good HELOC product and you're diligent in managing your finances.

Congratulations to you!  I'll be sending you a PM as we are looking at opportunities in the Macon area.