Seller financing can be a great way to get a house sold without slashing the price.
By recognizing the millions of people who can't get traditional financing as potential buyers, resourceful property sellers (and their real estate agents) can minimize their time investment in getting a property sold. Even better, sellers
who offer financing can usually get a higher asking price for their property, even in the slowest markets.
Clearly this is a win-win situation.
Most home sellers never consider financing the buyer directly because they are not aware of the benefits or don't fully understand how creating a note works. Let's take a closer look at the advantages of owner finance.
Three Advantages
Seller financing is very powerful when the market is slow or when there are many similar houses on the market. Just listing the house as "OWC" -
Owner Will Carry - will make the house stand out and attract more buyers. Because many individuals cannot get funding from a bank, offering financing will open the doors to these prospective customers as well, essentially significantly increasing the pool of potential buyers. So, advantage #1 is MORE BUYERS.
Seller financing also brings the property seller another critical advantage . the likelihood of selling for a higher price. Offering to carry back a note will not only greatly increase the number of potential buyers, but also bring a unique demographic of buyers who are willing to pay more for a given property than the general population.
Advantage #2: MORE MONEY.
Additionally, when the property seller finances the buyer, they get to act as "the bank". That means they could structure the deal to collect interest. Over time, if the seller holds on to their note, this can add up to tens of thousands of dollars in additional income.
Advantage #3: LONG TERM PROFIT.
The Seller's Strategy
Even when these benefits to "carryback" lending are made clear, many sellers are still hesitant to offer financing because they are entering unfamiliar territory. It's a natural, human response -- everyone is uncomfortable with new things.
For many property sellers, considering owner financing when they've only dealt with buyers via traditional funding is definitely "thinking outside the box". But once sellers understand the process, they are likely to choose seller financing instead of the unattractive option of cutting the listed price or waiting indefinitely
for the "right buyer".
A seller-financed real estate sale is simply a real estate transaction where the seller acts as "the bank" or lending institution. The seller sets the sales price, determines and accepts a down payment, and then finances the remaining
balance. The final step is the part that may scare some sellers, but in actuality, it can be very simple. Here is an example.
If the sales price is $100,000.00, and the buyer gives the seller $10,000.00 cash (the agent's fee will be deducted from this down payment), the seller will finance the balance of $90,000.00.
The buyer and seller would then agree to the terms, such as the interest rate and the total term, and use an attorney to create the mortgage document and close the deal.
From that point on, the buyer sends the seller monthly payments for the house he/she has just purchased.
Special Circumstances (and a Solution)
The whole process can really be that simple. But, there are some substantial differences between a seller-financed deal and one that relies on traditional bank funding.
First of all, the seller in this example does not receive a large, one-time payment at the time of the sale. In fact, they will only receive the down payment, and in some situations, most of that will go towards paying the real estate agent's fee.
On the other hand, the seller will be receiving monthly payments at a decent
interest rate, but this income stream can't be used as a down payment for a new house.
Since many home sellers are also looking to buy another property, the seller will need to get enough at closing to pay their own down payment.
Without this payment, the seller's hands will be tied when they look to purchase another house and need to have a substantial amount of funds available. There is a common solution to this issue, however.
The Solution
In order to get the money the seller needs from the loan they just created, the seller could sell the monthly note payments to a specialist buyer for a lump sum of cash. If the seller finds someone willing to buy the payments, now they can
"have their cake and eat it too".
In summary.
Step one: Use the seller finance option to find unique customers willing to buy the house at a higher price than would have been possible otherwise and complete the real estate transaction quickly.
Step two: Decide on the terms of the deal and create the note.
Step three: If the property seller needs immediate cash to buy another house or for any other reason, their new incoming payment stream can be resold. The person who buys the future payments from the seller will provide the funding to act as a down payment on a new house, and every party involved in the deal comes out smiling.
email us with any questions you may have or to sell your mortgage note or trust deed.
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Showing posts with label trust deed. Show all posts
Showing posts with label trust deed. Show all posts
Tuesday, June 2, 2009
Tuesday, May 19, 2009
Consolidate Your Debts
Are you facing difficulties in paying back the loans
because you have two or more pending debts? If your answer is yes, then
debt management is the solution for you. It is a process which
reorganizes your debts to more affordable repayments terms. It clubs
your multiple high interest unsecured loans, into a single loan with
lower interest rate.
Various financial aid consultants are
deployed by the lenders, who negotiate with your creditors on your
behalf. An expert from financial institute selected by you meets your
creditors and makes an arrangement after which, you just need to pay
certain amount to the institution and not directly to creditor. The
amount paid by you includes fee waivers and discounts on debts owed by
you. This service is also open for bad credit history holders. After
the loan consolidation, you just have to make a single monthly payment,
which covers for all the loans which get consolidated.
You can
ask for quotes from various lenders if you want to get this service.
The quotes are provided free of cost and they enable you to explore the
difference between costs of debt management options provided by
different loan providers. This management is offered to you keeping in
mind, your financial situation and credit status.
With the help
of a proper research about the financial institutes offering this
service, you can certainly spot competitive interest rates. With the
help of this management, you will no more have to face harassment from
different lenders, as you will only be dealing with a single loan
provider.
In order to strike the suitable deal, you can switch to
the Internet. With the help of on line mode, you can come across various
financial institutions and lenders providing you with this management.
You can make comparisons between different terms and conditions offered
by different lenders and then select a suitable deal.
Debt
management helps you to settle your scattered debts and multiple
financial obligations. It is an affordable way to deal with your debt
problems.
If you are holding a mortgage note, you can sell a mortgage note and get cash now.
If you have a mortgage note you can sell your mortgage note for cash now. We have buyers that want to purchase your mortgage note. We can close in 2-3 weeks. Click here to email us for more information.
Monday, May 18, 2009
Bankruptcy or Foreclosure, Which Is The Best Option
In the past, "Foreclosure" and "Bankruptcy" were considered two of society's dirty words. Today these terms are viewed by many as relief from Financial Black holes that can not otherwise be escaped. In the current economy, inundated with bad mortgages, many of which stem from predatory lending practices, coupled with credit card debt spinning out of control, bankruptcy and the loss of ones home have become common place. For many homeowners, a decision needs to be made as to which of these terms is the lesser of two evils.
For homeowners whose debt has spun out of control, and whose income does not cover expenses, foreclosure and or bankruptcy are options that may be inevitable. However, which of these terms truly is the lesser of two evils?
Should a homeowner file for bankruptcy, they may be able to eliminate all of their credit card debt, medical bills, court ordered judgments and even electric and gas bills. With the assistance of a bankruptcy discharge, they may then be able to stay current on their mortgage. However, many people are even more concerned about their credit score. They may ask, "Will we be able to obtain future financing?"
Should a homeowner rather, opt for foreclosure, they will certainly loose their home, but do they really want to keep it in this market where the house may be worth far less then what is owed. If a homeowner opts to walk away from their house, they may own other investment property, and be able to live in a multi-family house, or they may simply want to rent and not deal with all the hassles of homeownership. "If something breaks, let someone else fix it, repair it, deal with this problem".
Neither option is an easy choice. A bankruptcy will remain on your credit for 10 years, while a foreclosure will only remain for 8 years, but many credit counselors report it has twice the negative impact on your credit score compared with a bankruptcy. It will be extremely difficult to obtain a new mortgage for many years after you have lost a home to foreclosure. Many homeowners may see foreclosure as a better option then simply obtaining the financial relief that the Bankruptcy Laws provide. What many do not realize is that a foreclosure may be even a darker mark on their credit then a bankruptcy. As a result, it may be even more difficult with a foreclosure on their record to obtain subsequent housing. Many mortgage lenders look at a foreclosure more seriously than they will a bankruptcy. As a result, a former homeowner may not qualify to rent the apartment or house they want, even though they may be able to afford it now that the mortgage obligation is gone.
One of the key factors to keep in mind is that when you file and receive a discharge of your debt in a bankruptcy, even if your credit score is lower, you are still a better candidate to receive future financing and in very short order. The reason is simple. After your bankruptcy discharge, you do not owe anything to anybody. Additionally, creditors realize that you can not file for a new bankruptcy for another eight (8) years, and as such can not walk away from any new debt that you may incur as a result of credit extended to you by a new creditor, be it landlord, credit card, or other financing option.
Now it should be pointed out that in many cases, you may be so far behind that a foreclosure is going to happen no matte what. If this is the case, it may be in your interest to file for bankruptcy right before the order. The reason is that if the bank sells the property for less then what is owed, the difference (commonly referred to as the deficiency) will be discharged. As a result, the bank will often sit on a foreclosure order for some time before they act upon it, so as to not loose more money. In the meantime, a homeowner can possibly short sell their house and move on with their life.
Based upon the foregoing, if you are facing a financial crisis that may end in either foreclosure or bankruptcy, consult an attorney to explore what your best option may be. The right decision may save you years of restricted credit in the future.
If you have a mortgage note you can sell your mortgage note for cash now. Click here to email us for more information.
Check Your Credit Score Before You Apply For A Mortgage
Bad credit or good credit, the process of obtaining a mortgage has changed. Even if you are simply trying to refinance your existing mortgage, you may be surprised at how different things are. Of course your credit score always played a significant role in determining what kind of loan you can apply for, but nobody could have predicted what you need in order to get a mortgage today.
in the past, banks were eager to lend money to people who were interested in buying a new home. They would barely look at your income and sell you loans that were more than you could afford - virtually regardless of your credit history. A credit score of around 680 points would have been considered good credit and allowed you to get preferred rates and the best plans.
Today, just a few months later, things have changed dramatically and it is nearly impossible to get a mortgage without excellent credit. The good news is that along with those changes, it has become increasingly easy to increase your credit score.
Before you try to get a new home loan, the very first step is to access your personal credit information to find out where you stand on the credit score scale. You can then use this information to remove the errors that are common to credit reports, quickly increase your score, and then get approved for the loan you need.
You can also think about owner financing with a mortgage note. Click here to contact us for more information.
Wednesday, December 3, 2008
How to make sure you get the highest price for your mortgage note.
How to make sure you get the highest price for your mortgage note.
- Buyer's credit.
The better the credit rating of the buyers, the more valuable your note.- If they are a husband and wife, find out the credit rating of both of them. many time the wife is earning more than the husband.
- If you don't have a credit report, you can order a free report from us.
- Sale price of real estate.
If this is MORE than the actual value of the real estate expect to take a bigger discount when you sell the note. An experienced note buyer wants to have some equity in the property in case the buyer defaults. - Third party buyer.
If you sell to a family member or friend you WILL have difficulty collecting your payments. - Actual, provable value of the real estate.
If you are taking back a first mortgage note there is no legal reason to have an appraisal. But if you intend to SELL the note, any experienced note buyer will want to know what the property is worth. It may be harder to access the property and have an appraisal done after you close on the sale. - Loan to Value ratio. LTV.
For a note to be marketable the total LTV, that is including the first and second mortgage (if any) should be no more than 75% of the actual value of the property. However, if the buyer's credit is good, this 75% could refer to the Investment to Value or ITV. In other words, the amount the note buyer is investing in the note. Thus if the property is worth $100,000 and the buyer has put down a 10% payment and has a $90,000 mortgage, you could get $75,000 (75% of the value) for your note. - Who are the buyers?
If the buyers are husband and wife they BOTH need to sign the note. If the buyer is a corporation, trust or LLC then make sure the principals also PERSONALLY sign the note. If they refuse to do so this could be an indication they will let the note default if the deal doesn't work out for them. Of of, this need not apply if the buyer is a substantial corporation. (I wouldn't ask Bill Gates to personally sign on a note from Microsoft. :-) But how about a note from WorldCom or Enron?) If the borrower is NOT a substantial corporation then the note could be either unsaleable or only saleable at a much larger discount to reflect the lack of personal liability. - Seasoning, aging.
There is no doubt that a seasoned note, where the buyers have made payments for a year or more, is easier to sell and will get a higher price than a new one. But of course you won't have this option if you want to do a simultaneous closing. - Institutional lender allows secondary financing.
There are many institutional lenders, banks etc. that will not allow secondary financing behind their note. Why not? After all, their lien is senior anyway. One answer is simply that they do not want to the borrower to be stretched to make their payments. Also they would sooner the buyer put down more cash or pay for mortgage insurance (a fancy way of saying a higher interest rate.) - Loan properly secured.
If your mortgage is a second mortgage, it should be a properly recorded mortgage or deed of trust to comply with your local laws. Any documentary and intangible taxes should be paid. Without this the mortgage may be unenforceable. - Title insurance.
You should have proper mortgagee's title insurance. - Rights with respect to first mortgage, if you hold a second.
If you are holding a second mortgage it should contain language to the effect that a default on the first mortgage is a default on the second. Also that you, as second mortgage holder have the right to check on the payment status of the first. - Interest rate.
Other things being equal, the higher the interest rate, the higher the price you will receive. But be aware of laws concerning Usury and Predatory lending. A below market interest rate will demand a hefty discount to be saleable. - Length of note to short.
Typically it is hard to sell a note with a short balloon, or a balloon due in just 6-12 months. The note buyer will be concerned that the borrower won't be able to refinance and pay them off.
But a loan with for example, 3-5 years to run, and a 30-year amortization is going to be saleable, other things being equal. - Length of note too long.
The note buyer won't usually want to wait 30 years to get paid off, but these notes can often be sold to institutional note buyers.
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Tuesday, November 25, 2008
Mortgage Note Buyers Helping You Get The Most Money For Selling Your Mortgage Note
All mortgage note holders want to know more about selling their mortgage note. Don't you?
Well, the popular way to get a lump sum of cash for your future payments is by using a mortgage note buyer.
Most people don't realize they have different creative options when using a contract buyer that can keep them from getting the most money for their owner-financed mortgage note.
It may seem scary or challenging, but truly it is not, unless you do not know the answer to this question.
Can I receive cash now and still hold part of the note? In other words, do I have to sell all of my note at once?
At first glance, this may seem obvious that this is the best choice because it will get you the most money up front. For some people, it is. When it comes down to it, it is up to you and your needs. If you need or want a large all cash payment and want to be out of the deal, rid of headaches and worries of a default buyer, avoid destruction of property, taxes and insurance, and would like a larger sum of money now instead of collecting small monthly checks, then a full sale is best.
But let 's take a look at some more needs. If you are just looking to get a
larger down or some money to take care of some immediate needs or
pleasures, then a partial payment may be better. Maybe you just want to
lessen the amount of strain or burden of carrying the note and would like to sell just a portion of each monthly payment. Then a split payment option will be better for you. (This way you can go on vacation, consolidate debt buy a new car...)
What is a partial? A partial is the purchase of a portion of an income streams remaining payments, or a purchase of a portion of a specific payment, or any combination thereof.
There are many times when this may make sense. Let 's say that you have a new note and it has not been seasoned (length of time that a note has been in place and paid on), it has little or no down payment, and has poor credit by the payer. In this case, it would be better to sell only part of the future payments. It will get you more money in the long run because the mortgage note buyer would have less risk should the buyer default on the note. Then after the note has experienced seasoning you could sale the rest of the payments at a much higher percentage.
Let 's look at an example of this:
Sales price: $100,000
Down payment: $5,000
Original note balance: $95,000
Payers credit: poor
Seasoning: 1 month
Appraised property value: $100,000
Term: 360 months
Interest: 10%
Remaining payments: 359
This is a low quality note because the buyer is not putting much money down,
the pay back period is very long, and the buyer 's credit is bad. But you could still make out like a bandit by selling it as a partial. Let 's say you sold the first 120 payments (10 years) for $51,000. After the 120th payment, the contract would be returned back to you. The balance owed to you would be $86,391.12. You would then start to collect the payments from then on. Let 's see how this looks.
Sales price: $100,000
Down payment: $5,000
Original note balance: $95,000
Contract written for 30 years @ 10%
Monthly payment: $833.69
Note buyer purchases first 120 payments for: $51,000
Total cash to home seller $56,000
(down payment + cash from note buyer)
After 120 payments contract is returned to you with a balance of $86,391.12
Total money to you: $142,391.12 (including interest). Not shabby for a house that sold for $100,000.
So, what is a Split?
A split is a purchase of a specified monthly amount. If you're getting to the point where you would like to enjoy some of the finer things in life, while still receiving a good monthly income, then a split payment is a great choice for you.
For example, if the monthly payment on a seller-financed note is $1,000, we could purchase $200, $500, $750, etc. of the monthly payment. This will allow you to get cash now and then still collect a monthly income from the note.
All in all, each situation is different and may need to be tailored differently to meet your needs. I can't say exactly what you will get for your individual situation, but I can say that you should walk away happy. Selling your mortgage note should be much easier and more profitable now that you are armed with some creative options.
Get a free quote email us at quote@smilingdogenterprises.com
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Wednesday, November 19, 2008
How To Figure Out Mortgage Payments Without a Mortgage Calculator
In today 's world, taking out a mortgage is necessary for anyone who wants to invest in real estate or simply wants to put a roof over his head. Usually, to find out what a mortgage payment will be on a particular property, a potential buyer needs to contact a Realtor or bank to get a quote.
By contacting either one, the buyer risks harassment from a Realtor who won't let go of a qualified buyer, or a lender who needs to lend mortgage money to stay in business. Any buyer in his right mind will only go to one of these salespeople when he is ready to go full speed ahead toward a closing.
So, what does a person who is in the early thinking stages of buying a home do? How do you know what the payment will be on a house a seller is asking $250,000 for when the bank is advertising 30-year mortgages at 7%?
By the end of this article you will be making such a calculation in your head. You will be sprouting out the answer to complicated home buying scenarios just as fast as you can find the terms on the mortgage and the price on the house.
$66.53 a Month
First, remember this: $10,000 borrowed for 30 years at 7% will require a monthly payment of $66.53. So, it stands to reason $100,000 for 30 years at 7% requires a monthly payment of $665.30. Also take note you could figure out on a piece of paper with a pencil, $50,000 for 30 years at 7% is $332.65.
Knowing these figures, you automatically know a $250,000 mortgage at 7% for 30 years will require a payment of $665.30 (for $100,000) and another $665.30 (for the next $100,000) and $332.65 (for $50,000). This means the payment will be $1,663.25, or really, really close. A mortgage calculator gives the answer as $1,663.26, but for a wild guess, I'll take it.
A 6% or an 8% Mortgage
Of course, here you ask, "What if I find a mortgage with a lower interest rate?" Well in that case, remember this, $10,000 borrowed for 30 years at 6% costs the borrower $59.96 a month. This means a $1,000,000 mortgage for 30 years at 6% will be 100 times $59.96 or, a monthly payment of $5,996.00. Now, certainly that was easy. All we had to do was add 2 zeros!
Okay, what about if the interest rate is 8%? Here, a 30-year mortgage for $10,000 is $73.38 each month. So a $300,000 mortgage will come at a cost of 30 times that or, $2,201.40 a month.
How About a 71/4% Mortgage?
In reality, most times interest rates will not be exactly 6 or 7, or 8%. Even when this is the case, you still don't need a mortgage calculator. If you read about a 30-year $260,000 mortgage at 71/4%, for instance, and you want to know what the monthly payment will be, here 's what you do. Are you ready? Guess!
That 's right! Just guess! You know 7% will cost you $66.53 per $10,000 a month and 8% will cost $73.38 per $10,000 a month. You also know 71/4 is somewhere on the lower side between 7 and 8 so take a guess how much 71/4% will cost per $10,000 a month. My guess would be maybe, $68.50?
I'll go with that. So, since it is a $260,000 mortgage we're trying to figure the payment for, we will multiply 26 (260,000 / 10,000) X $68.50. The answer is: $1,781.
When I run $260,000 at 71/4% for 30 years through a mortgage payment calculator the answer comes out $1,773.66. So, our answer wasn't precisely right, but it was pretty close.
In a case like this, even if we came out with an answer that is $20-$30 off, who cares? Before the real mortgage payment is determined, the cost of a homeowner 's insurance policy and property taxes will have to be calculated anyway. So, the best anybody can do at this point is guess.
There you have it. Now, you're a human calculator! As long as you're only concerned with 30-year mortgages, and today 's going interest rates, which are 6% to 8%, you can figure out mortgage payments in your head, or maybe with just a little help from a pocket calculator.
Wednesday, November 12, 2008
Most Often Asked Questions About Selling A Mortgage Note
Mortgage note buyers exist to help you create, sell and understand your mortgage notes, contracts for deeds, trust deeds, and promissory note both residential and commercial.
Below you will find 5 frequently asked question about selling your mortgage note.
5 frequently asked questions, that most note sellers have about selling their owner-financed mortgage note are:
1. How much cash can I get? There are many factors in determining the offer price for selling a mortgage note The main four are equity, seasoning, interest rate, and credit of payer.
The more of these you have in your favor the larger lump sum you will get. This is why many mortgage note buyers offer a free no obligation quote.
If you look through some of the questions there, you'll see that they are simple and only take a few minutes to fill out.
These type of questionnaires are designed to keep you from having to dream about how much money you will get. The coolest part about it is, if nothing else, you know how much money you could receive if you wanted it.
2. How do I sell my note? Selling your note is easy. The first step is finding and contacting a mortgage note buyer or contract buyer and simply telling them that you want to sell your note.
This initial contact could be by phone, email, or through filling out a free mortgage note quote form. More than likely, if you are reading this, then you are at a site that can help you get a cash offer for your note.
If not, then there is a link to a good website and company above, that can give you a "No hassle, No obligation" quote.
Once you give the contract buyer some required information, they will be able to get back to you, usually within 24-48 hours, with an offer.
3. How long does the process take once I decide to move forward? After you have given the mortgage note buyer the required information, either by calling, email, or filling out an online form, they will get back to you in 24-48 hours.
Usually, it only takes 2-3 weeks to complete the deal and have a huge certified check deposited, or wired to your bank account.
4. When I convert my note to cash, how will it affect the person(s) paying me? Not at all. The terms, payment, and amount owed stay the same.
This is a really neat thing about selling your mortgage note. You can get a large sum of cash and it doesn't affect the person(s) paying you. Sounds like a "win-win-win" situation to me.
5. Where would the closing take place? Usually, at the closest title company near you. Sometimes it takes place in the town or city in which the property is located...which brings up another question.
Do you have to be there for the close? Nope, not generally. The person handling the title and closing the deal can send you the closing package. This is all done to make it as convenient and as easy for you as possible.
As you can see, getting a large sum of cash now for your future mortgage payment is an easy process that can put a lot of money into your pocket for a vacation, to consolidate bills, and buy or enjoy any other necessities or pleasures.
Mortgage Note Questions - How To Sell Your Mortgage Note
When it comes to selling real estate, one of the biggest obstacles sellers face is a so-called “depressed” market. Even when a property is highly desirable, it can be hard to get the price you want in this real estate environment. You could end up losing a lot of time, money, and opportunities, waiting for a “perfect buyer” who may NEVER materialize!
The traditional solution is to drop your asking price. But this common strategy doesn’t always work in your favor. In fact, it can work against you, making your home seem undesirable and your position seem weak.
But there IS a way to turn this challenge into a profitable opportunity! I am not selling anything. I am in the business of paying cash for mortgage notes and trust deeds.
Keep in mind that it has to make financial sense. Although having regular income is a nice idea, there comes a time when you might need a lump sum of cash for an investment, a large purchase or just to pay.
A cash flow notes statement documents the amount of incoming and outgoing cash and its equivalents. Only cash sales are recorded in a cash flow statement – all future sales including those made on credit are not declared.
Most banks refuse to accept a short sale or modify the terms of a mortgage unless the owners are numerous months behind in payments. The homeowners come to the bank to ask for help to avoid foreclosure. Individuals sell structured settlements to get liquid cash. They can be sold to special financial institutions. The main advantage of selling structured settlements.
In situations where you are holding the sell mortgage notes and receiving payments from the sale of commercial and residential real estate, and you are want to cash in on those payments, there are service agents who provide help. This technique has been the key in making up an estimated 20% of all private note sales.
Right now, thousands of people across North America are stuck with investments that they don’t want. They would rather have the cash now! Whether it’s a real estate note created when selling a property, a business note created when selling a business or even a structured settlement, there are thousands of notes out there that could be turned into cash!
Get cash now and forget those monthly payments FOREVER! We work with buyers who are ready to pay top dollar for your notes. If you have a trust deed, a mortgage note or any private loan, it's time to find out exactly how much CASH you could be entitled to.
* It's Quick: Learn how to cash out in minutes
* It's Easy: You could have cash in just days
* It's Secure: Get real quotes directly from certified buyers
There has never been an easier or faster way to cash out of your investment. Whether you need money to pay bills... to buy a home... to fund an education... or even if you just need some spending cash... We'll show you the money for your mortgage note or trust deed!
http://www.smilingdogenterprises.com
getcashnow@smilingdogenterprises.com
Thursday, October 16, 2008
Selling A Business with Seller Financed Mortgage Notes
Business notes or Promissory notes are created when a business owner sells a business using owner-financing. Seller financed business notes, or Seller carry-back notes, are almost identical to Owner financed mortgage notes, except that they are notes created from the sale of a business instead of a home or property.
It is significantly more difficult to get a bank loan for the purchase of a small business than it is to get a loan for the purchase of a home. Businesses historically have a high failure rate, and often do not have enough collateral to satisfy a bank loan.
It is very common for the seller of a business to take back a note (or "carry the loan") to help with the sale of the business. Business sellers usually have no choice but to offer seller-financing. They often accept a down payment for part of the sale, and a promissory business note for the balance. The usual down payment is 33-1/3%, and the seller receives a monthly payment from the buyer for 5 to 7 years. There may or may not be a balloon, interest rate is negotiated.
There are times when the seller is content to receive the payments over many years but it is often the case that they have needs for a lump sum payment instead of collecting the payments over time. The person holding the note however does not want to wait that long to receive all the money from the business, so he or she looks for a someone to buy all or part of the note being held.
10 Top reasons business note holders may want to sell their business note:
1. To Raise cash.
2. To Eliminate debt
3. To have the capital to start their next project
4. Enhance their investment portfolio or planning a new investment strategy
5. Want to buy real estate, home, car, boat or plane?
6. Need to pay for a medical emergency?
7. Need to fund a child 's education?
8. To Fund their favorite cause or charity
9. To Eliminate the hassle and worry of collecting payments
10. Or just want to take the vacation of a lifetime?
To meet your current financial objectives, you can now sell your business notes. In some cases you can sell all the remaining payments of your business note, while in other cases you may sell just enough payments to meet your need. And don't worry about your business 's buyer. When you sell your note, the sale does not affect the buyer at all. Their contract terms remain the same.
There is such a broad range of different types of business notes that can be purchased, it would be impossible to list them all.
Eligible Businesses on which NOTES are sold include, but are not limited to:
Dry cleaners, Hair, Nail salons, Auto repair shops, Printers, Medical & Dental practices, Restaurants/ Bars, Mini-markets, Convenience stores, Manufacturing companies, Various Service industries, Pest Control companies, Mail and Packaging centers, Building maintenance services , And many others . . .
Typical Business Note Buying Criteria:
A. First position as lien holder
B. Substantial down payment (usually 30%-35% minimum)
C. Seasoning (3-5 timely payments made already)
D. Buyer 's previous experience in business
E. Buyer has good Fico credit score (625-650 or above)
F. Note must be fully amortized and in first position
G. Note must be personally guaranteed
While these are typical criteria desired, but each transaction is considered on its own terms and strengths. Every note is reviewed on an individual basis.
I personally believe that most important reason to sell your business note today is that you take advantage of the financial principle of the Time Value of Money, which means that a dollar is more valuable to you today than it will be in the future; you get your money before inflation kills its value.
Click here to email us.
Smiling Dog Enterprises
It is significantly more difficult to get a bank loan for the purchase of a small business than it is to get a loan for the purchase of a home. Businesses historically have a high failure rate, and often do not have enough collateral to satisfy a bank loan.
It is very common for the seller of a business to take back a note (or "carry the loan") to help with the sale of the business. Business sellers usually have no choice but to offer seller-financing. They often accept a down payment for part of the sale, and a promissory business note for the balance. The usual down payment is 33-1/3%, and the seller receives a monthly payment from the buyer for 5 to 7 years. There may or may not be a balloon, interest rate is negotiated.
There are times when the seller is content to receive the payments over many years but it is often the case that they have needs for a lump sum payment instead of collecting the payments over time. The person holding the note however does not want to wait that long to receive all the money from the business, so he or she looks for a someone to buy all or part of the note being held.
10 Top reasons business note holders may want to sell their business note:
1. To Raise cash.
2. To Eliminate debt
3. To have the capital to start their next project
4. Enhance their investment portfolio or planning a new investment strategy
5. Want to buy real estate, home, car, boat or plane?
6. Need to pay for a medical emergency?
7. Need to fund a child 's education?
8. To Fund their favorite cause or charity
9. To Eliminate the hassle and worry of collecting payments
10. Or just want to take the vacation of a lifetime?
To meet your current financial objectives, you can now sell your business notes. In some cases you can sell all the remaining payments of your business note, while in other cases you may sell just enough payments to meet your need. And don't worry about your business 's buyer. When you sell your note, the sale does not affect the buyer at all. Their contract terms remain the same.
There is such a broad range of different types of business notes that can be purchased, it would be impossible to list them all.
Eligible Businesses on which NOTES are sold include, but are not limited to:
Dry cleaners, Hair, Nail salons, Auto repair shops, Printers, Medical & Dental practices, Restaurants/ Bars, Mini-markets, Convenience stores, Manufacturing companies, Various Service industries, Pest Control companies, Mail and Packaging centers, Building maintenance services , And many others . . .
Typical Business Note Buying Criteria:
A. First position as lien holder
B. Substantial down payment (usually 30%-35% minimum)
C. Seasoning (3-5 timely payments made already)
D. Buyer 's previous experience in business
E. Buyer has good Fico credit score (625-650 or above)
F. Note must be fully amortized and in first position
G. Note must be personally guaranteed
While these are typical criteria desired, but each transaction is considered on its own terms and strengths. Every note is reviewed on an individual basis.
I personally believe that most important reason to sell your business note today is that you take advantage of the financial principle of the Time Value of Money, which means that a dollar is more valuable to you today than it will be in the future; you get your money before inflation kills its value.
Click here to email us.
Smiling Dog Enterprises
Wednesday, October 8, 2008
Tips on How To Sell Your Mortgage Note
You might not have been aware of the fact that you can sell your mortgage notes or sell it online, but more and more sellers are choosing to do so.
Many people seeking a lump sum of cash want to know how to sell mortgage notes for top dollar and where to find a note buyer. Fortunately, the process is quite simple. You may get a competitive quote in a matter of hours.
The best part is you can take care of everything via phone, fax and email, so there’s no need to be in the same area, even the same state as the note buyer. And you can usually have your cash in hand within a few weeks, as the average transaction takes between 10-14 days to
complete.
We are experts at selling notes and you can fill out a form on line or contact us with any questions you may have. We will ask for a little information about you as well as details about
your note. Fill in as much information as you can as this will be helpful to the potential buyer.
During the initial contact you will discuss the details of your note including balance, time remaining, interest rate, payments to date, etc. The buyer will use all of this information to decide what to offer you for your note.
Keep in mind that it has to make financial sense for them as well, so the stronger the note the more you can expect to receive for it. Remember, the buyer is now assuming the risk for you, so they have to deal with all of the potential problems that could arise down the road,
e.g. inflationary pressures, payor default, unstable economy, etc.
To list your note, click here.
To email us your questions click here.
Thank you
Tuesday, October 7, 2008
The Real Estate Market with a New President
The existing real estate market is in decline and current forecasts do not see a significant rise any time soon. However, there are many variables that could affect this forecast. Being an election year, a new president, depending on the policies of his platform, may be able to change the economy to such an extent that the real estate market also changes. There is no guarantee that it will be for the better but it very well may affect change. This late in the game the front runners for the election are Barack Obama and John McCain.
Obama is a Democrat who has a proposed housing reform plan. His reformations include changes to the financial regulatory system to have stricter controls on financial institutions. Also in his plan is a system to help with the current foreclosure problem facing many Americans today. He proposes that the Federal government take steps to assist those who are in financial straits by buying out or refinancing existing mortgages to drop monthly payments.
Also, he wants financial institutions to restructure loans as early as possible when a borrower is having problems. In addition he wants to increase tax incentives for people who have mortgages so they can get a break on their taxes. His final initiative includes a federally funded program costing up to thirty million dollars to help with the existing foreclosure crisis facing America today.
McCain, a Republican holds that there should be little government intervention in the banking situation and that the economic issues should play out naturally. However, recognizing the crisis he is open to suggestion from leading authorities for temporary solutions for assistance in order to help the American public through the crisis. However, he maintains that any assistance should be temporary and any permanent reform should be in the means of regulatory changes and increasing the accountability of banks so that the crisis does not occur again.
He also insists that any financial assistance to the public should be for those in primary residences to save their home and no assistance should go to investors in trouble or those who have trouble keeping up a second home or vacation property. While McCain is amenable to analyzing the issue and open to discussion regarding possible solutions for both long and short term, he is non committal about what his housing policy is and refuses to make it a part of his campaign. He does not want to play on the fears of the public to win votes by touting a reform policy that is not feasible or would not pass.
Both Obama and McCain have recognized the existing housing problems in the country. Both have acknowledged a need for some type of reform. They do, however, disagree on how much government should be involved and in which aspects. Obama has a clear cut strategy for housing reform as part of his campaign platform but that does not mean anything will actually come to fruition if he is elected. McCain has been noncommittal in pinning down specifics but has stated it is something that will take precedence. How the market will unfold after the election, though, will depend not so much on who is elected but what will actually occur when they are. Right now, there is merely discussion and planning with nothing concrete evidenced by either side.
We buy mortgage notes and trust deeds.
Obama is a Democrat who has a proposed housing reform plan. His reformations include changes to the financial regulatory system to have stricter controls on financial institutions. Also in his plan is a system to help with the current foreclosure problem facing many Americans today. He proposes that the Federal government take steps to assist those who are in financial straits by buying out or refinancing existing mortgages to drop monthly payments.
Also, he wants financial institutions to restructure loans as early as possible when a borrower is having problems. In addition he wants to increase tax incentives for people who have mortgages so they can get a break on their taxes. His final initiative includes a federally funded program costing up to thirty million dollars to help with the existing foreclosure crisis facing America today.
McCain, a Republican holds that there should be little government intervention in the banking situation and that the economic issues should play out naturally. However, recognizing the crisis he is open to suggestion from leading authorities for temporary solutions for assistance in order to help the American public through the crisis. However, he maintains that any assistance should be temporary and any permanent reform should be in the means of regulatory changes and increasing the accountability of banks so that the crisis does not occur again.
He also insists that any financial assistance to the public should be for those in primary residences to save their home and no assistance should go to investors in trouble or those who have trouble keeping up a second home or vacation property. While McCain is amenable to analyzing the issue and open to discussion regarding possible solutions for both long and short term, he is non committal about what his housing policy is and refuses to make it a part of his campaign. He does not want to play on the fears of the public to win votes by touting a reform policy that is not feasible or would not pass.
Both Obama and McCain have recognized the existing housing problems in the country. Both have acknowledged a need for some type of reform. They do, however, disagree on how much government should be involved and in which aspects. Obama has a clear cut strategy for housing reform as part of his campaign platform but that does not mean anything will actually come to fruition if he is elected. McCain has been noncommittal in pinning down specifics but has stated it is something that will take precedence. How the market will unfold after the election, though, will depend not so much on who is elected but what will actually occur when they are. Right now, there is merely discussion and planning with nothing concrete evidenced by either side.
We buy mortgage notes and trust deeds.
Monday, October 6, 2008
Five Steps to Improve Your Credit
For many, improving credit is an important step towards a chance at some of the most important aspects of everyday life. Good credit is vital if you want to own a good car, a good house, or any other major purchase. Like millions of people in America, you might have a few issues with your credit report; here are a few hot tips that can lead to improvement:
Step One: One of the best things you can do in your efforts to improve your credit is to learn your rights. Laws protect you as a consumer, and thus your credit score as well. You need to be familiar with those laws and your rights to improve that score. Policies of all sorts are in place that regulate everything from criteria regarding rejection to the ways a collection agency is allowed to go after late payments. If you're unaware of your rights, you'll find it difficult to insist on the proper steps that are in place to help you. Confusion is the enemy.
Step Two: The three major credit bureaus (TransUnion, Experian and Equifax) are required to provide you with a free copy of your credit report once a year, at your request.
Step Three: Once you have the credit report in-hand, go over it in miniscule detail. File a report for each and every negative item immediately. Any negative item must be investigated by the bureau: if they don't verify it within 30 to 45 days, the item must be removed! There are many reasons creditors refuse to verify information, which is great news for anyone trying to improve their credit. Better still, file your disputes when the credit business is busiest to help ensure there's less chance of verification.
Step Four: For certainty's sake, send every dispute form by certified mail (which only costs a few dollars extra) and request return-receipt. Make sure your records are extremely detailed, covering dates, times, names, every single minor step along the way. You want this process to be rife with delays and it will only help if you can make yourself as difficult as possible for them to deal with. Just one person failing in the verification-chain on their end, that's all it will take to get the negative mark cleared off your record.
Step Five: 30 to 45 days after you've sent in your dispute, get another copy of your report. Pay for it this time if you have to! Review it from top to bottom and start making phone calls about why unverified information hasn't been removed; it had plenty of time, after all. Dispute anything that remains, over and over and over again, until they get tired of dealing with you. Don't give up, because the reward for your persistence is an improved credit score!
In truth, it isn't difficult to improve your credit score, not really. It's as easy as getting your report, disputing everything negative, and repeating those steps until you get the results you want. Pay attention to every little detail and keep strict records, and you'll be well on your way to the better score that you want.
Step One: One of the best things you can do in your efforts to improve your credit is to learn your rights. Laws protect you as a consumer, and thus your credit score as well. You need to be familiar with those laws and your rights to improve that score. Policies of all sorts are in place that regulate everything from criteria regarding rejection to the ways a collection agency is allowed to go after late payments. If you're unaware of your rights, you'll find it difficult to insist on the proper steps that are in place to help you. Confusion is the enemy.
Step Two: The three major credit bureaus (TransUnion, Experian and Equifax) are required to provide you with a free copy of your credit report once a year, at your request.
Step Three: Once you have the credit report in-hand, go over it in miniscule detail. File a report for each and every negative item immediately. Any negative item must be investigated by the bureau: if they don't verify it within 30 to 45 days, the item must be removed! There are many reasons creditors refuse to verify information, which is great news for anyone trying to improve their credit. Better still, file your disputes when the credit business is busiest to help ensure there's less chance of verification.
Step Four: For certainty's sake, send every dispute form by certified mail (which only costs a few dollars extra) and request return-receipt. Make sure your records are extremely detailed, covering dates, times, names, every single minor step along the way. You want this process to be rife with delays and it will only help if you can make yourself as difficult as possible for them to deal with. Just one person failing in the verification-chain on their end, that's all it will take to get the negative mark cleared off your record.
Step Five: 30 to 45 days after you've sent in your dispute, get another copy of your report. Pay for it this time if you have to! Review it from top to bottom and start making phone calls about why unverified information hasn't been removed; it had plenty of time, after all. Dispute anything that remains, over and over and over again, until they get tired of dealing with you. Don't give up, because the reward for your persistence is an improved credit score!
In truth, it isn't difficult to improve your credit score, not really. It's as easy as getting your report, disputing everything negative, and repeating those steps until you get the results you want. Pay attention to every little detail and keep strict records, and you'll be well on your way to the better score that you want.
Sunday, October 5, 2008
Foreclosure vs Bankruptcy effects on Credit Reports
Nothing is worse for your credit score than a foreclosure or a bankruptcy credit report. Not only will these red flags remain on your credit record for seven years, but your score could drop as much as 300 points overnight, impacting your ability to borrow money for years. Your credit report will show every time you’re 30 days late on a mortgage payment and then the “Notice of Default” will show up. If you are able to stop the house from foreclosing, then you’ll have a good chance at repairing your credit over the next few years. Otherwise, the “Notice of Trust Sale” and the “Trust Deed Sale” will hit your report, scarring your financial freedom for the next seven years or more.
Once you’ve looked at your credit report, you’ll need to focus on improving your credit score. Pay all your outstanding bills on time, first and foremost. On-time bill payments account for roughly 35% of your credit score. Start with the highest interest rate cards and reduce your credit usage to 30% of what’s been extended to you. Replenish your savings, your 401k and other retirement accounts. You may want to contact CCSInc.org to obtain credit counseling and take free financial classes to re-educate yourself on how to save and spend wisely. A foreclosure can really shatter your confidence, as well as your purchasing power, so it’s important that you take this opportunity to reassess how you approach financial decision making as a whole.
So which is worse for your credit score, a foreclosure or a bankruptcy? Even though bankruptcy stays on your credit for 10 years and a foreclosure for 7, “a foreclosure is very serious to mortgage lenders,” said Ray Hooper, Education and Housing Director for the Consumer Credit Counseling Service. “They’re going look at a foreclosure more seriously than they will a bankruptcy that doesn’t include the house.” Hooper says if you’re receiving default notices but still want to keep your house, then you’ll need to catch up on those missed payments.
Once you’ve looked at your credit report, you’ll need to focus on improving your credit score. Pay all your outstanding bills on time, first and foremost. On-time bill payments account for roughly 35% of your credit score. Start with the highest interest rate cards and reduce your credit usage to 30% of what’s been extended to you. Replenish your savings, your 401k and other retirement accounts. You may want to contact CCSInc.org to obtain credit counseling and take free financial classes to re-educate yourself on how to save and spend wisely. A foreclosure can really shatter your confidence, as well as your purchasing power, so it’s important that you take this opportunity to reassess how you approach financial decision making as a whole.
So which is worse for your credit score, a foreclosure or a bankruptcy? Even though bankruptcy stays on your credit for 10 years and a foreclosure for 7, “a foreclosure is very serious to mortgage lenders,” said Ray Hooper, Education and Housing Director for the Consumer Credit Counseling Service. “They’re going look at a foreclosure more seriously than they will a bankruptcy that doesn’t include the house.” Hooper says if you’re receiving default notices but still want to keep your house, then you’ll need to catch up on those missed payments.
Wednesday, September 10, 2008
How to Get More Than The Asking Price For Your Property
Part 4 of 4
How Creative Home Sellers Have The Advantage
Creative home sellers offering seller financing can often sell their houses faster in a slow market - often at a higher price! In the process, these sellers act as the “bank,” and begin to receive monthly payments instead of a lump sum of cash.
So what happens when those offering seller financing need an immediate lump sum of cash instead of scheduled future payments? Locating a buyer for the newly-created cash flow could be the answer.
To get the money they need, sellers that offer financing could sell the future mortgage payments they are set to receive.
How sellers get quick cash for their notes
This process can be streamlined when the savvy home seller lines up a buyer for the payment stream before the note is even created. This way the property seller could have a buyer for the payment stream ready to make the purchase as soon as the new private mortgage is created. Once the closing and the note sale are complete the seller will have the money she needs for her next home.
Finding the buyer for the seller-financed mortgage is the tricky part. Buyers won't line up at the door. In fact, they don't often browse the newspaper or the web looking for people with notes to sell. This is where the professional Note finder comes in!
Note Finders are real estate professionals that specialize in connecting the people who create notes with those who buy them.
While I do not assist with the creation of a note, I can provide general recommendations about the types of terms that are attractive to Note Buyers. With my knowledge, experience, and connections within the secondary finance industry, I can save home sellers a lot of time and effort when liquidating a note. Most importantly, I can help locate a buyer for your note and make the process smooth and easy.
When working with a property seller who needs a lump sum of cash immediately after selling real estate, contacting a finder like me early in the process of creating the real estate note makes sense.
By involving a Note finder before a note is created, the property seller can receive valuable input about the payment characteristics that Note Buyers prefer.
And for any completed seller-financed deals, a qualified Note finder can help Note Holders obtain a large amount of cash in exchange for future payments.
Greetings,
My name is Sydney Griecci. As a professional note finder, I specialize in developing creative cash solutions; namely, I help note holders receive a lump sum of money in exchange for their secured real estate notes. I can also show home owners how to sell their property with seller finance.
Once a real estate note is created, it can be sold for cash shortly after the close of escrow. Existing notes can also be sold to achieve cash liquidity.
Additionally, if you are looking to purchase a paper asset for your own portfolio, I have the resources to show you many viable opportunities.
If you are an attorney, CPA, real estate agent, mortgage broker, title agent or escrow officer, I can assist you in helping your clients realize quick sales of hard-to-sell properties through the use of private financing.
If you would like to learn more about the creation and/or sale of secured private notes, please contact me directly.
Join my mailing list or subscribe to this publication by leaving me your contact information. I can be reached via email
Sincerely,
Sydney Griecci
Follow us at Twitter to be informed of the next update to this article.
We buy Mortgage Notes
How Creative Home Sellers Have The Advantage
Creative home sellers offering seller financing can often sell their houses faster in a slow market - often at a higher price! In the process, these sellers act as the “bank,” and begin to receive monthly payments instead of a lump sum of cash.
So what happens when those offering seller financing need an immediate lump sum of cash instead of scheduled future payments? Locating a buyer for the newly-created cash flow could be the answer.
To get the money they need, sellers that offer financing could sell the future mortgage payments they are set to receive.
How sellers get quick cash for their notes
This process can be streamlined when the savvy home seller lines up a buyer for the payment stream before the note is even created. This way the property seller could have a buyer for the payment stream ready to make the purchase as soon as the new private mortgage is created. Once the closing and the note sale are complete the seller will have the money she needs for her next home.
Finding the buyer for the seller-financed mortgage is the tricky part. Buyers won't line up at the door. In fact, they don't often browse the newspaper or the web looking for people with notes to sell. This is where the professional Note finder comes in!
Note Finders are real estate professionals that specialize in connecting the people who create notes with those who buy them.
While I do not assist with the creation of a note, I can provide general recommendations about the types of terms that are attractive to Note Buyers. With my knowledge, experience, and connections within the secondary finance industry, I can save home sellers a lot of time and effort when liquidating a note. Most importantly, I can help locate a buyer for your note and make the process smooth and easy.
When working with a property seller who needs a lump sum of cash immediately after selling real estate, contacting a finder like me early in the process of creating the real estate note makes sense.
By involving a Note finder before a note is created, the property seller can receive valuable input about the payment characteristics that Note Buyers prefer.
And for any completed seller-financed deals, a qualified Note finder can help Note Holders obtain a large amount of cash in exchange for future payments.
Greetings,
My name is Sydney Griecci. As a professional note finder, I specialize in developing creative cash solutions; namely, I help note holders receive a lump sum of money in exchange for their secured real estate notes. I can also show home owners how to sell their property with seller finance.
Once a real estate note is created, it can be sold for cash shortly after the close of escrow. Existing notes can also be sold to achieve cash liquidity.
Additionally, if you are looking to purchase a paper asset for your own portfolio, I have the resources to show you many viable opportunities.
If you are an attorney, CPA, real estate agent, mortgage broker, title agent or escrow officer, I can assist you in helping your clients realize quick sales of hard-to-sell properties through the use of private financing.
If you would like to learn more about the creation and/or sale of secured private notes, please contact me directly.
Join my mailing list or subscribe to this publication by leaving me your contact information. I can be reached via email
Sincerely,
Sydney Griecci
Follow us at Twitter to be informed of the next update to this article.
We buy Mortgage Notes
Wednesday, September 3, 2008
How to Get More Than The Asking Price For Your Property
Part 2 of 4
Equity attracts Note Buyers
One key to liquidating a seller-financed mortgage is found in the property’s equity. The equity in the private note essentially acts as a “safety net” for the Note Buyer, in case there is a problem collecting the payments. So note buyers find deals with strong equity more attractive.
Remember, a Note Buyer is purchasing monthly payments secured by property. If the property is worth more than the remaining balance of the note, the buyer could seize the extra value in a foreclosure situation by reselling the property. This allows the new Note Holder to recoup his initial outlay and receive the additional equity.
Most Note Buyers will do a quick equity check before looking at any other information. By first determining the note’s Loan-To-Value (LTV), buyers can decide whether to dig deeper or move on. The LTV is calculated by comparing the balance of all of the loans to the value of the property.
Two equity examples
To illustrate, let’s consider two houses, each valued at $100,000. One home has loans of $95,000 and the second home has loans of $70,000.
The first home has an LTV of 95 percent (95k/100k = 95), indicating only 5 percent equity (100 – 95 = 5).
The second home has an LTV of 70 percent (70k/100k = 70), showing 30 percent equity in the property (100 – 70 = 30).
Clearly, most buyers will not be as interested in the note on the first home because there is virtually no protective equity. In this situation, the buyer of the note would want to discount the note purchase a fair amount to make up for the fact that there is little equity.
The second note with 70 percent LTV will require less discounting, and the Note Holder will receive a larger portion of their note as compared to the note balance. This is because the Note Buyer stands to benefit from holding a substantial amount of equity in the property (30 percent) if the Payor were to default on their obligation.
Join my mailing list or subscribe to this publication by leaving me your contact information. I can be reached at 303.317.4488 or via email at sydney@smilingdogenterprises.com.
Sincerely,
Sydney Griecci
Follow us at twitter to be informed of the next update to this article.
Equity attracts Note Buyers
One key to liquidating a seller-financed mortgage is found in the property’s equity. The equity in the private note essentially acts as a “safety net” for the Note Buyer, in case there is a problem collecting the payments. So note buyers find deals with strong equity more attractive.
Remember, a Note Buyer is purchasing monthly payments secured by property. If the property is worth more than the remaining balance of the note, the buyer could seize the extra value in a foreclosure situation by reselling the property. This allows the new Note Holder to recoup his initial outlay and receive the additional equity.
Most Note Buyers will do a quick equity check before looking at any other information. By first determining the note’s Loan-To-Value (LTV), buyers can decide whether to dig deeper or move on. The LTV is calculated by comparing the balance of all of the loans to the value of the property.
Two equity examples
To illustrate, let’s consider two houses, each valued at $100,000. One home has loans of $95,000 and the second home has loans of $70,000.
The first home has an LTV of 95 percent (95k/100k = 95), indicating only 5 percent equity (100 – 95 = 5).
The second home has an LTV of 70 percent (70k/100k = 70), showing 30 percent equity in the property (100 – 70 = 30).
Clearly, most buyers will not be as interested in the note on the first home because there is virtually no protective equity. In this situation, the buyer of the note would want to discount the note purchase a fair amount to make up for the fact that there is little equity.
The second note with 70 percent LTV will require less discounting, and the Note Holder will receive a larger portion of their note as compared to the note balance. This is because the Note Buyer stands to benefit from holding a substantial amount of equity in the property (30 percent) if the Payor were to default on their obligation.
Join my mailing list or subscribe to this publication by leaving me your contact information. I can be reached at 303.317.4488 or via email at sydney@smilingdogenterprises.com.
Sincerely,
Sydney Griecci
Follow us at twitter to be informed of the next update to this article.
Saturday, August 9, 2008
Sell Your Property FAST - for the PRICE YOU WANT!
Creative Financing Journal
How to Sell Your House Fast - At The Price You Want!
The Inside Secrets To Seller Financing
When it comes to selling real estate, one of the biggest obstacles sellers face is a so-called “depressed” market. Even when a property is highly desirable, it can be hard to get the price you want in this real estate environment. You could end up losing a lot of time, money, and opportunities, waiting for a “perfect buyer” who may NEVER materialize!
The traditional solution is to drop your asking price. But this common strategy doesn’t always work in your favor. In fact, it can work against you, making your home seem undesirable and your position seem weak.
But there IS a way to turn this challenge into a profitable opportunity!
The seller finance solution
More and more home sellers are turning to private financing to sell properties quickly and at the best possible price. Why? Because it’s a great way to attract an untapped group of potential buyers looking to buy a home outside of conventional financing.
Seller financing can put you back in the driver’s seat and turn ANY market into a SELLER’S DREAM!
You see, there is a large percentage of first-time home buyers who cannot get approved for bank funding because of their credit situation. These buyers will often offer to pay even MORE than the asking price for the opportunity to live the American dream of home ownership.
Once you understand a few secrets to seller financing, you’ll know why these “credit challenged” folks can be your “perfect buyers” and provide a positive solution for ALL parties involved…
Seller financing: a powerful tool to sell homes in a stagnant market
Private financing can lead to many more home buyers
Seller financing could help sellers get more money for their property
Sellers could still receive the cash they need when financing the sale of their property
How to Sell Your House Fast - At The Price You Want!
1. Seller financing can enable YOU to sell your home quickly and easily, at the price you want.
2. It gives the BUYER a chance to purchase a home that would otherwise be out of reach.
3. If a real estate agent is involved, it allows the agent to collect a commission from a sale that wouldn’t happen through traditional means.
So everyone wins!
Turning the sale into cash
But what happens if the buyer does not put down a substantial down payment and the seller needs additional cash to purchase another property? That’s where the beauty of seller financing comes in. It’s possible for the seller – now the mortgage holder – to turn around and sell the mortgage note for a lump sum of cash!
It’s easier and more common than most people ever imagine!
As a professional Note Finder, I specialize in helping holders of mortgage notes get immediate cash for their paper asset. In fact, if you or someone you know holds a mortgage note, I can help turn it into CASH right now!
“Seller financing is a powerful tool to remedy real estate situations that otherwise look grim.”
Liquidating your seller-financed notes
How a Note Finder Helps It All Happen For You!
There is a growing group of note business professionals known as “Note Finders” who are making it easier than ever to sell real estate notes. These folks are individuals who help Note Sellers find a buyer. Also known as cash flow specialists or note liquidators, Note Finders collect and organize information about potential note sales so that people who buy notes can easily determine if the stream of income is right for them.
Note Finders serve to inform Note Holders of their options. They also help to streamline the process of selling a cash flow by helping Note Holders to understand the process.
Note Finders know what types of note terms, interest rates, down payments, and payment schedules Note Buyers prefer, and are familiar with typical yield notes. Therefore, an experienced finder can give home owners pertinent information to structure a new note so that it sells quickly.
As a Note Finder, I have an in-depth understanding of the private note industry and I am able to approximate the value of most secured cash flows.
Keep in mind that Note Finders do not act on the behalf of either the Note Holder or the buyer and do not provide counsel to either party; we represent ourselves.
I can give you an idea of what makes a note attractive to buyers as well as present information about a note to potential buyers, but will not assist either party with the decision to finalize a note deal.
Seller Financing: Creating A Note For Quick Sale
Seller financing is a popular way to sell real estate without dropping the price. In fact, builders will often offer financing to sell the properties they’ve built in a difficult market without having to reduce their prices. When the property owner is willing to “carry back” a note many advantages can result:
1. The Seller can get a higher selling price.
2. The property can sell faster.
3. The overall sales closing ratio can increase.
4. The note can generate a steady payment stream for long-term income.
But in order to sell a house this way, the home owner needs to market the property to a different type of buyer.
Attracting “credit challenged” buyers requires a different strategy to reach a different demographic. The seller must use a more targeted marketing technique, designed specifically for the “unconventional buyer’s market.” And the most effective advertising methods to tap into this distinctly separate pool of buyers might surprise you!
Seller Financing: Creating A Note For Quick Sale
How much is a note worth?
When deciding to liquidate a seller-financed note the first step is uncovering how much the note is worth. To do that, it’s best to get inside the head of the Note Buyer.
Note Buyers always want a good deal, so most of them will usually begin by conducting a quantitative evaluation of the numbers on a cash flow. The two factors that buyers look at first are the note term and interest rate.
How term affects note pricing
To illustrate, consider these two similar notes with different terms. Assume that both notes have a balance of $100,000, with a fixed interest rate of 8 percent.
The first note has payments of $733.76 per month over 30 years (360 months), while the second note will be paid off in 10 years (120 months) at $1,213.28 monthly – a term three times shorter. For this example, assume that the buyer is looking to yield 15 percent on the remaining payments.
If no payments had been made towards the $100,000 balance, the buyer’s offer at 15 percent would be $58,030.25 for the 30-year note and $75,202.55 for the 10-year note. Based on the figures alone, you can see that the second note with the shorter term will receive a much higher offer.
An “interesting” consideration
The interest rate is also a important point for buyers when they start their note evaluation process. Specifically, buyers look for interest rates that are “just right” – neither too high nor too low. Interest rates that are too high will make it difficult for the Payor to meet her monthly payment obligations, making a foreclosure likely.
Conversely, when the interest rate is too low, many buyers find that the amount they can pay for the note typically won’t meet the seller’s needs. As a result, many buyers will avoid making offers on notes with extremely low interest rates because past history has shown that these deals can be difficult to close.
Yield vs. Interest = Discount
Here is the critical point: the amount of the discounted offer that a seller gets from a prospective buyer is usually a direct result of the difference between the interest rate and the buyer’s yield. A note with a lower interest rate forces the buyer to make up his yield from the discount instead of the interest that accrues each month. So, as the difference between the note’s interest rate and the buyer’s desired yield grows the offer to the seller decreases.
This effect can be illustrated using two notes, both written for $100,000 and amortized over 30 years. The first has an interest rate of 3 percent and payments of $421.60. The second note is amortized at an interest rate of 10 percent with monthly payments of $877.57.
If the buyer wants to yield 15 percent on the remaining payments (with no payments made yet), the offer for the first note would only be $33,342.72 on the 3 percent note, but $69,403.63 for the 10 percent note. Remember that the balance on each note was $100,000, so the discount is $66,657.28 and $30,596.64 respectively… simply because of the difference in interest rate.
Any experienced buyer who runs these figures will realize that almost all Note Holders would find a discount of $66,000 or more on their $100,000 note very difficult to swallow. A few buyers might consider lowering their personal yield requirements in an attempt to reduce the discount – if the note has other compelling attributes.
I look forward to talk with you further about any of the strategies explained here. Please contact me if you’d like to discuss this information or for help with any of your note transactions.
Seller Financing: Creating A Note For Quick Sale
Greetings,
My name is Sydney Griecci. As a professional note finder, I specialize in developing creative cash solutions; namely, I help note holders receive a lump sum of money in exchange for their secured real estate notes. I can also show home owners how to sell their property with seller finance.
Once a real estate note is created, it can be sold for cash shortly after the close of escrow. Existing notes can also be sold to achieve cash liquidity.
Additionally, if you are looking to purchase a paper asset for your own portfolio, I have the resources to show you many viable opportunities.
If you are an attorney, CPA, real estate agent, mortgage broker, title agent or escrow officer, I can assist you in helping your clients realize quick sales of hard-to-sell properties through the use of private financing.
If you would like to learn more about the creation and/or sale of secured private notes, please contact me directly.
Join my mailing list or subscribe to this publication by leaving me your contact information.
Using unconventional marketing to attract the “credit challenged” buyer
The seller’s best strategy for finding credit-challenged buyers is to advertise the property in media that is read or seen by individuals who do not have a real estate agent.
The “For Sale By Owner” section in the local newspaper is the best place to start, because that’s where the majority of home buyers go when looking for seller financing. Even in today’s Internet-dominated business world, newspaper advertising continues to be the best way to reach those looking for seller-financed deals.
All it takes is a simple sale ad including the line “seller financing available,” “credit issues OK” or “little or NO down payment needed” and you should catch the attention of the right potential candidates.
Additional buyers for a seller-financed real estate deal could respond to an advertisement on an online classified website. There are many popular and low-cost consumer websites with networks all across North America. By including the search terms “seller finance,” “seller carry back” or the acronym “FSBO” in your online classified text, you’re sure to reach many potential buyers nationwide.
How to do the deal
Once an interested buyer is located and the details of the initial payment, payment term, interest rate, and any necessary clauses are established, the buyer and seller can move forward to create a seller-financed note.
The details of the note creation are easily handled with a standardized boilerplate or the assistance of an attorney. Then the paperwork is recorded at the courthouse and the note deal is finalized.
If you need to know more about selling real estate with private cash flows, I will be happy to help. I am a professional Note Finder and I can help facilitate the transaction for you, as well as help you find an immediate cash settlement for the property seller after the note is created.
sydney@smilingdogenterprises.com
How to Sell Your House Fast - At The Price You Want!
The Inside Secrets To Seller Financing
When it comes to selling real estate, one of the biggest obstacles sellers face is a so-called “depressed” market. Even when a property is highly desirable, it can be hard to get the price you want in this real estate environment. You could end up losing a lot of time, money, and opportunities, waiting for a “perfect buyer” who may NEVER materialize!
The traditional solution is to drop your asking price. But this common strategy doesn’t always work in your favor. In fact, it can work against you, making your home seem undesirable and your position seem weak.
But there IS a way to turn this challenge into a profitable opportunity!
The seller finance solution
More and more home sellers are turning to private financing to sell properties quickly and at the best possible price. Why? Because it’s a great way to attract an untapped group of potential buyers looking to buy a home outside of conventional financing.
Seller financing can put you back in the driver’s seat and turn ANY market into a SELLER’S DREAM!
You see, there is a large percentage of first-time home buyers who cannot get approved for bank funding because of their credit situation. These buyers will often offer to pay even MORE than the asking price for the opportunity to live the American dream of home ownership.
Once you understand a few secrets to seller financing, you’ll know why these “credit challenged” folks can be your “perfect buyers” and provide a positive solution for ALL parties involved…
Seller financing: a powerful tool to sell homes in a stagnant market
Private financing can lead to many more home buyers
Seller financing could help sellers get more money for their property
Sellers could still receive the cash they need when financing the sale of their property
How to Sell Your House Fast - At The Price You Want!
1. Seller financing can enable YOU to sell your home quickly and easily, at the price you want.
2. It gives the BUYER a chance to purchase a home that would otherwise be out of reach.
3. If a real estate agent is involved, it allows the agent to collect a commission from a sale that wouldn’t happen through traditional means.
So everyone wins!
Turning the sale into cash
But what happens if the buyer does not put down a substantial down payment and the seller needs additional cash to purchase another property? That’s where the beauty of seller financing comes in. It’s possible for the seller – now the mortgage holder – to turn around and sell the mortgage note for a lump sum of cash!
It’s easier and more common than most people ever imagine!
As a professional Note Finder, I specialize in helping holders of mortgage notes get immediate cash for their paper asset. In fact, if you or someone you know holds a mortgage note, I can help turn it into CASH right now!
“Seller financing is a powerful tool to remedy real estate situations that otherwise look grim.”
Liquidating your seller-financed notes
How a Note Finder Helps It All Happen For You!
There is a growing group of note business professionals known as “Note Finders” who are making it easier than ever to sell real estate notes. These folks are individuals who help Note Sellers find a buyer. Also known as cash flow specialists or note liquidators, Note Finders collect and organize information about potential note sales so that people who buy notes can easily determine if the stream of income is right for them.
Note Finders serve to inform Note Holders of their options. They also help to streamline the process of selling a cash flow by helping Note Holders to understand the process.
Note Finders know what types of note terms, interest rates, down payments, and payment schedules Note Buyers prefer, and are familiar with typical yield notes. Therefore, an experienced finder can give home owners pertinent information to structure a new note so that it sells quickly.
As a Note Finder, I have an in-depth understanding of the private note industry and I am able to approximate the value of most secured cash flows.
Keep in mind that Note Finders do not act on the behalf of either the Note Holder or the buyer and do not provide counsel to either party; we represent ourselves.
I can give you an idea of what makes a note attractive to buyers as well as present information about a note to potential buyers, but will not assist either party with the decision to finalize a note deal.
Seller Financing: Creating A Note For Quick Sale
Seller financing is a popular way to sell real estate without dropping the price. In fact, builders will often offer financing to sell the properties they’ve built in a difficult market without having to reduce their prices. When the property owner is willing to “carry back” a note many advantages can result:
1. The Seller can get a higher selling price.
2. The property can sell faster.
3. The overall sales closing ratio can increase.
4. The note can generate a steady payment stream for long-term income.
But in order to sell a house this way, the home owner needs to market the property to a different type of buyer.
Attracting “credit challenged” buyers requires a different strategy to reach a different demographic. The seller must use a more targeted marketing technique, designed specifically for the “unconventional buyer’s market.” And the most effective advertising methods to tap into this distinctly separate pool of buyers might surprise you!
Seller Financing: Creating A Note For Quick Sale
How much is a note worth?
When deciding to liquidate a seller-financed note the first step is uncovering how much the note is worth. To do that, it’s best to get inside the head of the Note Buyer.
Note Buyers always want a good deal, so most of them will usually begin by conducting a quantitative evaluation of the numbers on a cash flow. The two factors that buyers look at first are the note term and interest rate.
How term affects note pricing
To illustrate, consider these two similar notes with different terms. Assume that both notes have a balance of $100,000, with a fixed interest rate of 8 percent.
The first note has payments of $733.76 per month over 30 years (360 months), while the second note will be paid off in 10 years (120 months) at $1,213.28 monthly – a term three times shorter. For this example, assume that the buyer is looking to yield 15 percent on the remaining payments.
If no payments had been made towards the $100,000 balance, the buyer’s offer at 15 percent would be $58,030.25 for the 30-year note and $75,202.55 for the 10-year note. Based on the figures alone, you can see that the second note with the shorter term will receive a much higher offer.
An “interesting” consideration
The interest rate is also a important point for buyers when they start their note evaluation process. Specifically, buyers look for interest rates that are “just right” – neither too high nor too low. Interest rates that are too high will make it difficult for the Payor to meet her monthly payment obligations, making a foreclosure likely.
Conversely, when the interest rate is too low, many buyers find that the amount they can pay for the note typically won’t meet the seller’s needs. As a result, many buyers will avoid making offers on notes with extremely low interest rates because past history has shown that these deals can be difficult to close.
Yield vs. Interest = Discount
Here is the critical point: the amount of the discounted offer that a seller gets from a prospective buyer is usually a direct result of the difference between the interest rate and the buyer’s yield. A note with a lower interest rate forces the buyer to make up his yield from the discount instead of the interest that accrues each month. So, as the difference between the note’s interest rate and the buyer’s desired yield grows the offer to the seller decreases.
This effect can be illustrated using two notes, both written for $100,000 and amortized over 30 years. The first has an interest rate of 3 percent and payments of $421.60. The second note is amortized at an interest rate of 10 percent with monthly payments of $877.57.
If the buyer wants to yield 15 percent on the remaining payments (with no payments made yet), the offer for the first note would only be $33,342.72 on the 3 percent note, but $69,403.63 for the 10 percent note. Remember that the balance on each note was $100,000, so the discount is $66,657.28 and $30,596.64 respectively… simply because of the difference in interest rate.
Any experienced buyer who runs these figures will realize that almost all Note Holders would find a discount of $66,000 or more on their $100,000 note very difficult to swallow. A few buyers might consider lowering their personal yield requirements in an attempt to reduce the discount – if the note has other compelling attributes.
I look forward to talk with you further about any of the strategies explained here. Please contact me if you’d like to discuss this information or for help with any of your note transactions.
Seller Financing: Creating A Note For Quick Sale
Greetings,
My name is Sydney Griecci. As a professional note finder, I specialize in developing creative cash solutions; namely, I help note holders receive a lump sum of money in exchange for their secured real estate notes. I can also show home owners how to sell their property with seller finance.
Once a real estate note is created, it can be sold for cash shortly after the close of escrow. Existing notes can also be sold to achieve cash liquidity.
Additionally, if you are looking to purchase a paper asset for your own portfolio, I have the resources to show you many viable opportunities.
If you are an attorney, CPA, real estate agent, mortgage broker, title agent or escrow officer, I can assist you in helping your clients realize quick sales of hard-to-sell properties through the use of private financing.
If you would like to learn more about the creation and/or sale of secured private notes, please contact me directly.
Join my mailing list or subscribe to this publication by leaving me your contact information.
Using unconventional marketing to attract the “credit challenged” buyer
The seller’s best strategy for finding credit-challenged buyers is to advertise the property in media that is read or seen by individuals who do not have a real estate agent.
The “For Sale By Owner” section in the local newspaper is the best place to start, because that’s where the majority of home buyers go when looking for seller financing. Even in today’s Internet-dominated business world, newspaper advertising continues to be the best way to reach those looking for seller-financed deals.
All it takes is a simple sale ad including the line “seller financing available,” “credit issues OK” or “little or NO down payment needed” and you should catch the attention of the right potential candidates.
Additional buyers for a seller-financed real estate deal could respond to an advertisement on an online classified website. There are many popular and low-cost consumer websites with networks all across North America. By including the search terms “seller finance,” “seller carry back” or the acronym “FSBO” in your online classified text, you’re sure to reach many potential buyers nationwide.
How to do the deal
Once an interested buyer is located and the details of the initial payment, payment term, interest rate, and any necessary clauses are established, the buyer and seller can move forward to create a seller-financed note.
The details of the note creation are easily handled with a standardized boilerplate or the assistance of an attorney. Then the paperwork is recorded at the courthouse and the note deal is finalized.
If you need to know more about selling real estate with private cash flows, I will be happy to help. I am a professional Note Finder and I can help facilitate the transaction for you, as well as help you find an immediate cash settlement for the property seller after the note is created.
sydney@smilingdogenterprises.com
Monday, June 23, 2008
Sell your Mortgage Note or Trust Deed
Click on this link to sell your mortgage note or trust deed.
Smiling Dog Enterprises
Sell Your Note
The Note Service provides a unique link between people with notes to sell and the qualified investors who buy them. When you list your real estate notes below you could receive real offers quickly from some of the industry's top buyers.
Providing you with a direct link to qualified buyers, the Note Service encourages quick responses, competitive bids and industry leading service.
Simply agree to the terms and conditions below to post your note.
I Agree (Terms & Conditions)
Please list your note secured by real estate by clicking:
It is only necessary to list your note once. Please read our Terms & Conditions, which you agree to when using Smiling Dog Enterprises
Smiling Dog Enterprises
Sell Your Note
The Note Service provides a unique link between people with notes to sell and the qualified investors who buy them. When you list your real estate notes below you could receive real offers quickly from some of the industry's top buyers.
Providing you with a direct link to qualified buyers, the Note Service encourages quick responses, competitive bids and industry leading service.
Simply agree to the terms and conditions below to post your note.
I Agree (Terms & Conditions)
Please list your note secured by real estate by clicking:
It is only necessary to list your note once. Please read our Terms & Conditions, which you agree to when using Smiling Dog Enterprises
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