All Forum Posts by: Rebecca Williams

@Alex Folchi,

Hi Alex, I’ve purchase using seller financing and I I love it. It’s my preferred method because everything is negotiable. Interest rate, length of time, down payment, it’s all negotiable. As long as you run your numbers right and plan appropriately, you don’t need to fear the balloon. When you go to refinance, plan on only getting 70% of the the value of the property and subtract what you owe. You can sometimes get a higher percentage than 70% but plan on 70% to play it safe. Make sure those numbers are equal at the very least and you’ll be able to refinance and pay off the balloon. If these numbers already work when you buy it then you can refinance in as early as 6 months. If you’re buying it at market value with no down payment then you may need a few years. These are the things you have to consider in order to negotiate.

Example:

Purchase price 150k with no down payment

Appraises at 200k

70% of 200k is 140k

In this scenario you’re short 10k so you would need 10k cash to refinance. This doesn’t account for market appreciation or forced appreciation so it could be less, depending.

Hope this helps.

Good luck!

@James Edward

My preferred method is seller financing because of the flexibility you have with the terms. I have found them simply by networking and asking the question “would you consider seller financing”. Some people understand the concept and are willing to do it and some people don’t understand and you have to explain it to them but overall, it’d a relatively simple process.

@Brett Hicks

The beauty with using private money is that the terms are negotiable and there are many different options on how you can structure it. It’s not one formula. If you don’t already have a relationship with them they will probably want you to have some “skin in the game” even if the deal is good but If it’s someone that already trusts you then they might be comfortable funding you 100%.

Relationships are key!

@Kyle Robarts

I just went through this and had similar questions. What I've learned is that it's possible to do this but beware that the lender can call the note due if they did not approve of this beforehand. Talk to your lender about your intentions and if possible get it in writing. If you decide not to put it back into the LLC just make sure you have adequate insurance. Good luck!

@Chris Piper

Thank you so much for taking the time to write this post. Very informative!

@Kevin Hill

I’m a rookie so I appreciate you taking the time to give advice and insight on issues that could arise. Very helpful.

Thanks for the Info! 

@Patrick Bavaro

Thanks for sharing, it gives me some ideas. Best of luck!

@Kerry Baird

Thank you! I think I understand now.

@David M.

Very helpful, thank you.