All Forum Posts by: Trevor Smith

@Gautam Venkatesan

Hi Gautam. You may be right. Believe me, if I had an army of private lenders to help me, I would use it not only for owner-financing but everything else including flipping. I don't have a single one and I don't know how to get them. And what interest rate would they want? 10%? That is the same interest the buyer will be paying so there is no cash-flow there. 

But if you know private lenders that would loan me money at a decent rate or even partner with me, then I would give you a referral commission and a big hug. 

What I don't want to do is spend thousands of dollars every month on marketing, trying to scrape a good deal away from the clamoring masses of other investors here. Yuck. That is not what I want to do. And flipping requires good deals, and good deals requires scraping and scouring. 

This brokering strategy does not require good deals. The buyers can choose a home at retail prices. 

@Jay Hinrichs 

You have something against the term play ball, I get it. This term offends you. We don't have to use it. The reason I'm worried about it is for obvious reasons--because I've heard the horror stories of a note being called due and I want to avoid it. If I am required to inform the lender when the loan is wrapped lest I commit fraud, then I will inform them with the first check from the new buyer. All I was looking for in this thread is a way to know if that lender is going to call it due or not. No one has given me ANY answer whatsoever. The only strategy so far is to cross your fingers and I was hoping to find something better. 

If you have done hundreds of wraps, and you're familiar with the pitfalls that other people have suffered, then you could be an invaluable resource for me and I would appreciate your help. Can we talk on the phone? 

@Jay Hinrichs

Well...since 99.99% of wraps are not called due...I'd say I will find lenders that play ball 99.99% of the time. 

Calm down turbo. I don't plan to jeopardize anything. We were simply having a conversation. 

@Account Closed Hah yeah ok. Thank you for talking with me. 

@Account Closed

Okay let me clarify. The original borrower that is borrowing from the lender is the investor. He will have great credit, good job, etc. The buyer/tenant is the one that will have a wrap mortgage that he owes to the investor. 

I propose that the original insurance stay in place in the investor's name. He signs documents and gives them to the buyer/tenant that will give the buyer/tenant a slam dunk case in court just to assure to him that the investor could never pocket the insurance claim for himself. But all along, no name is changed on the insurance, and the lender never needs to know about it. 

Make sense?

@Account Closed

Yes good point. What if there was a document drawn up by an attorney that stated that the investor will keep his name on the insurance, but in ever receiving a claim payout, he is required to spend it for the reasons that the payout was awarded? We can make a paper trail of signed documents that the buyer/tenant would have to take to court in case the investor tried to keep the payout. The buyer/tenant could have a slam dunk case. All of this would be completely without the lender's knowledge of course. 

Is that conceivable? 

@Account Closed I'm not sure if your question was rhetorical. I will tell the borrower it is fine because they will get their down payment back when we sell the house. But that sucks for him. What if it doesn't sell? I would have to cover the payments until it does. That is what I want to avoid! But you're not giving me any help! 

Is there a way to keep the home insurance in the name of the investor? Then the lender would never even need to know. 

@Jordan Madewell I really appreciate your help! That is very kind of you. Please let me know if your contacts are interested in working with me. 

@Account Closed I think you are right. So a better question is this: How do I find lenders that will secretly play ball? Or how do I negotiate working with them and know that we are playing ball without bringing it up?? I don't mind telling them the house is going to be a rental. I don't mind telling my investors not to ask the lender about doing a wrap. 

But I need to feel confident that the due on sale clause is not going to come up. I can handle it if it does--We will undo the wrap and I will cover the payments for the investor until the house sells and we pay the lender off. But I want to be 99% sure it wont happen. 

Any advice? 

@Jordan Madewell

Hi, thanks for asking me to clarify, perhaps I confused others as well. 

I am looking for lenders that will do wraps. I don't mind high lending requirements. I can find investors with good credit and good jobs. But I want to be able to tell them with confidence that the note is not going to be called when we do the owner finance deal. 

Hey guys,

I am very excited about being a broker for owner finance deals. I have been studying for months. I want to connect investors with people that have bad credit. There will be a wrap-around mortgage. I plan to follow all regulations and be compliant in every law so I don't need the regulation police on this post, please. 

I need help in finding lenders which I can connect with my investors. I want to be able to refer my investors to a group of lenders I have lined up already and they can get pre-approved and we can knock some deals out. I have found one so far but not done a deal with him yet. He requires 55k combined income, 700+ credit score, and 20% down. And he is offering less than 6% interest. He has worked on wrap deals before and I know that his bank will not call the note due. 

But how do I find more lenders that will not call the note due? I can't ask them, or they are obligated to tell me they will call the note due. I cannot tell them what I plan to do, or they will tell me that cannot allow that. So do I have to tell a white lie about how the investors will be holding the properties as rentals? What do I do? Tyvm