3 Tips to Get Commercial Sellers to Say YES to Your Offer

Source: http://youtu.be/VBc-Y1UwMYQ

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Are you contemplating investing in real estate? However you don’t have enough cash to do so. Right here is a tip you are able to use as long as the property seller is willing to negotiate along.

To be fair, not every seller will be interested (or even understand) the concept outlined. Your best guess is to find 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 are currently renting and thinking of using this strategy perhaps your landlord would be happy to assist you! There are some variations that could be used depending on you and your owner. Do they desire the market price or are they just desperate to get out from the monthly payments – maybe facing foreclosure?

The easiest way is to consider taking over their mortgage payments – called ‘assuming’ the mortgage. You will need to be approved by the original lender to assume the mortgage. If you can’t get approved for an assumable mortgage you could also try a ‘subject to’ assumption where you merely make repayments while the property remains in the seller’s name.

You take over the first mortgage and create a second mortgage on the remaining cost of the property with the seller. Offer a high, interest-only payment for a short time period – two or three years. Instead of having the money stay in a bank they could be getting a high interest over 2 or 3 years with the rest due in full at the end of the investment term.

When the term draws to a close you need to be able to refinance the cost, or you can sell. Unless you strike an actual bad market the value of the home should have risen by then.

Most mortgage lenders merely want to make a great investment. While your local bank could still shy away there are a lot of financial lenders that would want to make a deal. Financiers like property investing. The mortgage is mostly around 60-70% of the value of the property, so as long as they understand they get their money back in the value of the property if you default, they do not care what kind of revenue you make. Conclude the deal with a second mortgage created with the seller. In case you default they could still foreclose on the property and sell it, settling the existing mortgage in the proceeds.

Now you can observe 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 initial price with a little versatility on their part.

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