Promissory Note Structures
In ref. to a prior post about a sub-2 I purchased and upon request here is the details:
I wanted the property and thus went with an offer to secure the deal. The pm is a Promissory Note (not secured against the property) with a term of 6 years with 0% interest for $7,500 however I planned to pay it off in 3 yrs and gave it a early payoff discount to $5,000 in 3 years. Balloon meaning no monthly payments.
My reason for making it 7500 in 6 years was a backup plan, should I not choose to, or be able to pay it off in 3 years, I have an additional 3 years. I always try to structure my notes with extra leeway like this.
Chris
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