I found a house that was FSBO. He originally wanted to do only conventional financial but I came correct. I outright told him that I had no money but I really wanted his property.
You see prior to me telling him that I called about the property and after a little small talk I found out that he was a retired school principal and he and his wife started investing in 1973 so they could retire early. Now he had no kids at home they all live down south out Florida way. He really wanted to get close to them but felt locked down to California because of all the property he owned. He was pretty set with money and selling the home way under value just to get rid of them.
So now I knew what his buttons were. He just wanted to go. So I found out how many properties he had here and asked how much for each. All of the properties were paid for 100%. This is what he told me.
$229K for 4/2 1574 VACANT (appraised 4/2/08 295K
$290K for 4/2 2204 OCCUPIED (rent 1800 appraised 355K)
$310K for 4/3 2303 OCCUPIED rent 1950 appr. $386K)
I knew there was no was I could get any sort of financing at all let alone on three houses, so I THOUGHT A LITTLE DIFFERENT. I made him this offer.
202K for the $229 house with 5000K down - 1300 month with 500.00 going toward down payment monthly (can rent for 1600-1800) and complete owner carry at end of one year for 191K (included him paying escrow fees of 2K for me upfront and including them back purchase price). This would give him 11K as down payment total after one year or approx. 5%. After that 100% of payment toward purchase price and OWNER FINANCE!
225K for the $290K house with 5K down - tenant already in home on 2 yr lease paying 1800 monthly. 1200 of that going toward monthly payment and 600.00 month CASH FLOW for ME! Price includes escrow fees. OWNER FINANCE!
265K for the 310K house with nothing down. 1000K of monthly rent going toward purchase price and 950.00 CASH FLOW for me. Price included escrow, OWNER FINANCE!
Now you may be wondering how I did that AND got him to finance and everything else. Here is the story. since I knew all properties were owned free and clear and he was set with money and just want to get rid of them and leave I made this offer. Owner finance all of the properties for me and I will make monthly payments to him in a nice amount for each. He no longer had to worry about managing them or the responsibility. He signs them over to me and I in turn give a promissory note with the term. He did not want to deal with any realtor's so this went old school. Where you word is bond.
Now he has a monthly check coming to him and his wife (they are in their 70's) for 2800.00 every month for the next 30 years and they dont even have to work for it. Yes, there were getting more but this owner told me this. He had to start somewhere when he started and so do I. This gentleman gave him a chance and let him buy his first house in 1963 owner finance. He called me after midnight last night and asked me if I really wanted then all, I said yes he said meet him at the escrow office at 11am today. He and his wife are now planning on moving in 2 weeks! He told me he was giving me MY chance, just dont mess it up.
GOD IS GOOD and so is DEAN! Thank you Dean for giving me the courage to step up, find the buttons that make people work. I now own 3 beautiful houses and have made a really good friend (the owner) in the process.
p.s. did I mention he would take no interest on the financing. The 10K I am using to put down came from the line of credit I still had open with bank from my business.
TWITTER - anitarny / FACEBOOK - anitarny
"FAILURE IS NOT AN OPTION"