$0 Down Brainwave On L/O
I had an idea I thought I'd get some input pls peeps
L/O $4000 DOWN
purchase price now is $140,000
rent asked:$1300 per month
how 'bout
pay rent @t $300 per month .
for 36 months
Seller can offset this on taxes yeah?
refinance in 36 months at asking price+balance of rent initially asked for: difference of $36,000
purchase price then becomes $176,000
if option is not exercised after 3 yrs,you have a signed clause that states TB will reimburse you $36,000 for the rental difference.
ok shoot.....
hi
well, im not sure if this looked like a ditzy idea or whether our L/O peeps weren't around at the time.
This house is one we looked at for ourselves is all.
Seemed to be a logically sound move given that the home is in a rather '"fashionable "let's get out of the city and still be able to afford to live and commute '" area.
Any ideas?
seeed ok at the time as seller still gets what he wants.
the Mrs
It's going to have to appraise for that higher price if you want the loan.
Also, I think it would be tough to get the seller to bite on it since all he has is your option to buy. No obligation on your part.
If you can pull it off then that would be way cool. I think that it will be a tough sale though.
Hey Curly,
Not clear on how you are describing the situation.
The numbers you placed up on your last post, is this your payment from the original seller or is this the payment you are going to receive fromt he T/B?
Don't know what you are paying out
good luck
Ok,
being creative you are... but if you were the one holding that note would you accept 1,000 less per month? and "trust" someone to drop 36k in your lap.... novel idea but I dont think it will fly....
Quote:
On 2003-10-17 12:42, Curly wrote:
I had an idea I thought I'd get some input pls peeps
L/O $4000 DOWN
purchase price now is $140,000
rent asked:$1300 per month
how 'bout
pay rent @t $300 per month .
for 36 months
Seller can offset this on taxes yeah?
refinance in 36 months at asking price+balance of rent initially asked for: difference of $36,000
purchase price then becomes $176,000
if option is not exercised after 3 yrs,you have a signed clause that states TB will reimburse you $36,000 for the rental difference.
ok shoot.....
Here's my 2 cents:
Cash Flow is King! If I'm the seller and my mortgage payments are $X, I would need that covered, plus some passive income. No way I'd lose money on a monthly basis on a gamble that the T/B will actually buy.
Kind regards,
Phil
you're right peeps, it was just a pssing thought, but the concept needs fine tuning...how bout another way though...
take over lease with option to buy in 36 months
Sell option to new TB who doesnt want to live there, but he pays 40 k to you, which will give you the 4K down and 36x$1000 months extra to cover shortfall in the rent.
After 36 months he takes over the property and either keeps it or finds another buyer.
He then pays out the 100K balance to seller (original)and my option to him was only 131 total on a now 161K property assuming 3 yrs of appreciation.
so, TB just made mega bucks for the benefit of me tying up 40K of his cash for 36 months he has a nice semi new home for 70% FMV.
I payout first seller the diff of 9K
Hope this looks clear im not awake yet lol
thoughts?
criticism?
Curly,
Creative you are, but in the real world, this ain't gonna happen. Sorry.
Someone is going to put $40K down for the option to buy a property that they aren't going to live in? VERY doubtful.
They'll make "mega-bucks" doing it? Using your figures (which are high), he would only make $20K for a 3 year deal. Not the great, IMO. Add in closing costs, etc. and it's even worse.
Not trying to put a damper on your thinking, but I think you'll do better if you put yourself in these positions and ask "what would you do?" I know that I wouldn't plop down $40K in an option.
Roger
I guess you're right, got myself thinking though