Let’s discuss the importance of understanding your local mobile home market, local buyers, and local sellers. By the end of the short list below, you should have a much better understanding of your plan and mindset moving forward into the coming months while investing in individual mobile homes and manufactured homes inside parks in the US. […]…
To stay up to date with the latest information in the property investing industry to may check out our property investing latest news. On the other hand in case you’re new to real estate investing and desire to start profitable property investing now get a copy of our profitable real estate investing ebook.
Are you thinking of investing in property? But you do not have enough money to do so. In this article is a tip you can use as long as the person selling the property is willing to negotiate along.
To be fair, not all sellers will be interested (or even understand) the concept outlined. Your best wager is to locate a land that the owner has great desire for selling, whether because of moving, divorce, or frustration with the folks renting the property.
Actually, if you maybe currently renting and considering using this technique perhaps the owner would be happy to help you out! There are several variations that may be used depending on you and your owner. Do they need the market price or are they just desperate to get out of the monthly payments – maybe facing foreclosure?
The simplest method is to consider taking over their mortgage obligations – called ‘assuming’ the mortgage. You will need to be approved by the original lender to presume the mortgage. If you can’t get approved for an assumable mortgage you may as well try a ‘subject to’ assumption where you merely make payments while the property stays in the seller’s name.
You take over the original mortgage and get a second mortgage on the remaining cost of the house with the seller. Offer a high, interest-only payment for a short time period – two or three years. Rather than having the money stay in a bank they could be collecting a high interest over two or three years with the rest due in full at the end of the investment term.
When the term ceases you should be able to refinance the cost, or perhaps you can sell. Unless you strike a genuine bad market the value of the property should have risen by then.
Most mortgage lenders merely need to make a great investment. While your local bank could still be scared there are a lot of financial lenders that would want to make a deal. Financiers prefare property investing. The mortgage is usually based on 60-70% of the value of the land, so as long as they know they get their money back in the value of the land if you default, they do not care what sort of revenue you make. Complete the deal with a second mortgage done with the seller. In case you default they can eventually foreclose on the property and sell it, paying off the existing mortgage in the proceeds.
Now you can see the complete picture. It is good that seller and buyer can work hand in hand. If they can’t wait for a sale, you could still give them their asking price with a little versatility on their part.