All Forum Posts by: Marco Bario

@Darryl Matthews -

Thank you so much. I'll reach out to him now.

I'm interested in networking with landlords in Frederick County, MD. 

I'm interested in learning more about the area from a landlord's perspective.

The five-year term is the biggest concern. It increases the dollar amount of your payments, and you'll be forced to find cash in five years. You'll be backed into a corner if the lending environment is unfavorable when that occurs. Can you access other sources for purchase money? Some hard money lenders offer buy and hold financing. The Norris Group is operating in Florida now (began in CA). They offer it, and there are others, I'm sure. 

Be careful with balloons. You don't know how the property will perform, what natural disasters (or pandemics) might occur, or what the credit markets will look like when it comes due. If the seller won't let it go, see if you can negotiate an upfront option to extend. 

@Paul Lim -

I'd avoid using the word "typical" when talking about seller financing. I've seen hundreds of seller-financed notes. No two are the same. 

Examples: 

I recently bought a note which was written to mature in 5 years, and there are no payments due until maturity. Interest accrues beginning at 1% in year 1, then increases by 1% each subsequent year.

I regularly see notes written at 0% interest.

I regularly see notes where no down payment was made.

I know investors who've bought property using seller financing and negotiated that no payments would be due until the property begins generating income.

...from your position, it's best to understand the seller's needs and offer options to address those while meeting your needs. Also - don't rule out lease option in your scenario.

@Will Stewart -

I reached out privately in case you'd rather not share details of your deal here - but if you'd like to share a bit in the forum, I and others I sure would be happy to help. That way others may learn as well.

@Padric Lynch -

If you're able to refinance, you may be able to negotiate a discounted payoff. That would be a win-win for you both.

If you aren't able to finance her out, she could sell the note. 

@Jacob Wint - 

"Assume a mortgage" means the lender allows you to step into the shoes of their original borrower. You'll find most lenders don't allow it - and if they did it's not in your best interest. 

"Subject to" would allow the same benefits and more. The homeowner agrees the loan will remain in their name following closing, but grants you a limited power of attorney to communicate with their lender, and it's agreed you will make payments going forward. The lender isn't made aware. It technically violates "due on sale" in the mortgage or deed of trust which allows the lender to call the remaining balance due immediately upon transfer of title - although it's rarely exercised (but you should be aware). 

Hi @Makayla Hartley -

The Central Ohio Real Estate Entrepreneurs (COREE) real estate club has been putting out excellent content on the acquisition-related methods and strategies you're talking about. You may find leads as well. They run a very good Friday morning haves/wants and exchange meeting which is hosted on Zoom. I live on the West Coast but find value in being a member.

Vena Jones-Cox who runs the club also hosts a weekly radio show (free) I think you'd enjoy.