Comments on: Get This Paperwork Done to Develop Massive Equity in Property You Don’t Own…Yet

By: Mike

Mike — Wed, 05 Sep 2007 14:37:27 +0000

Are you serious. What happens to the guy with the loan on the house when the new owner stops paying for the loan.

By: eddie

eddie — Fri, 07 Sep 2007 01:57:38 +0000

what I dont understand is why would the seller give them a second mortgage after he’s given it to them to sell.

Also; if they sell the scond mortgage for 40k then when they new buyer gets the 60k they’ve really only made 20k havent they, not to suggest that this is to be sneezed at by any means, still well worth having.

thanks

By: Don Christie

Don Christie — Fri, 07 Sep 2007 07:35:19 +0000

Mike,
If you had the chance to buy a house this way would you miss any payments? They still own it on paper, you are merely paying it off for them until you can get your money together or refinance them out.

Eddie,
When you sell the house at $300,000 for example, you can leave in what is called a 2nd Mortgage. The new buyer agrees to get a loan for the 80% and you can then get on with your life and equity.
The new buyer owes you the 20% or in this case $60,000. You can have that paid like an investment term deposit. ie $125 / month in interest with the amount owing.

Your question is why sell that ‘right’ for $40,000? Its probably a profit from capital growth anyway, but you reach so many people in the market place that do not have a deposit or cannot get regular finance.

I think for about 5 hours work, you can get you buyer ready to buy from you and your seller setup to get on with their life.

If you only make $20,000 for 5 hours work, i can guarantee you its better than most professions, and remember you did not have to get a loan to get control of the property.
Cheers
Don

By: eddie

eddie — Fri, 14 Sep 2007 03:34:45 +0000

Donchristie; I’m sorry but theres something I don’t understand about this arrangement; Please correct me where I’m wrong but as I see it;

Person A, wants to sell his house so he gives it to person B. Person B sells it to person C on time payment directly to person A.

Does B take the 2nd mortgage from A or C????

C pay back the 2nd mortgage to person B who sells it to D????

Is not person B acting as an agent for which a licence is required.

Why would person A give his house to B to sell it for whatever he can get?

thanks

By: Don Christie

Don Christie — Fri, 14 Sep 2007 22:32:52 +0000

Hi Eddie,
You need to get your head around this.
There is always 3 people in the system. You are just the guy putting it all together, or making two other parties meet.
One guy needs to sell due to divorce or sickness, so they will give you the chance to sell it if you talk to them like you are a guy who is going to do what you say you are going to do.

As for person a scenario you talk about is a 2nd mortgage carryback, you can read more about it in other posts on my site.

I think reading more informaion about Lease Options or Rent Buy in my posts also.
Don

By: Brett

Brett — Tue, 18 Sep 2007 10:16:39 +0000

Hi Don,

I am very familiar with and completely understand this concept, however have had no luck in putting a deal like this together despite several attempts! I am also on the Gold Coast, and find that every time an agent is invloved, the deal is dead before you begin…
Have you found this to be the case also? I guess my question to you is: Do you put these together through people selling privately, or is there a trick to getting an agent on board with the idea?

I really look forward to your answer, as this particular strategy interests me greatly and I would love to be doing this today!

Many thanks,
Brett

By: Don Christie

Don Christie — Wed, 19 Sep 2007 23:15:48 +0000

Make sure that the agent gets some money or at least a deal that he will be paid. Thats all they want, then they will work at getting your deals done.
When wrapping property, I am happy to pay the agent a trail commission just like a broker gets paid by the bank. Only if they introduce me to the ‘client’. This usually occurs when the agent has got thier client to contract stage and they collapse. Then they call me!!
Private sellers are nervous enough, with out confusing them!
Don

By: Brett

Brett — Wed, 19 Sep 2007 23:58:01 +0000

Thanks for your advice Don. I guess it is a matter of having good relationships with agents as you’ve said earlier, and also having some cash upfront to cover the agents commission…

I don’t want to harp on this topic for too long, but would you be able to give a brief commentary on wording and how you have successfully approached the idea with an agent. I feel that this is probably the key and could assist a lot of people out there trying to pull this off.

I’ll let you know when one comes off for us - hopefully not too far down the track!

Cheers,
Brett