All Forum Posts by: Nancy Bender

To follow up on this post, I am going to be a private lender to this buyer. The length of the loan is one year. We are doing an interest only loan at 12%. The principle of 156K will be paid back to me next July 1. I have myself covered in that if he defaults on the loan, the condo becomes mine. There is a deed in lieu of foreclosure statement already included in the contract. I wanted that in there in the event of any unforeseen possibilities that could occur!

Thanks for the welcome! I am speaking to a lawyer tomorrow. I have since found out that he is a doctor with two divorces in 10 years, which put him in a bad credit score category. He has put down 10K on a 199K one bedroom condo (everything is current). He will lose that without finding a private lender before his July 1st closing. The idea is to have me buy the condo and he becomes my tenant with his rent going towards the purchase of the unit.I also think the 6% is not enough and then there is the matter of the monthly costs I will incur owning it. His rent has to cover all of those expenses first. If there are too many risks for me and not enough benefits, I definitely won't be doing it. I wasn't looking for this kind of opportunity to begin with, my realtor knew I was interested in income producing properties so he brought this to me today.

A realtor I've used frequently asked if I'd be interested in helping a doctor client of his finance a condo, (it will be his primary home) He can't get financing because of a messy divorce and the closing is next week. He would like a loan of $190,000, paying me 6% interest. If he defaults after one year the property would be turned over to me. (This would all be drawn up legally.) My question - Is this worth my time and if so, what would be a fair interest rate?