Archive for November, 2008
November 23rd, 2008 categories: Seller Financing
Last week I talked about looking for that something that would get me jumping out of bed . . . excited about the day and loving life!
I believe the most important thing you can do is to “find” yourself . . . and then “BE” yourself! Are you even looking for who and what you are?
If not, spend some time every day seeking what it is that gets you going. What’s fun? What makes you laugh? No one is going to jump out of bed in the morning to “pay the bills”, or “do the report”, or take care of all the other obligations they have.
Your obligation is to be true to yourself! To trust and honor what you know in your soul is the “thing” that would make your heart sing. There’s nothing musical about paying the water bill!
You want to be the best damn (mother, father … fill in the blank) you can? Be the best damn YOU first! But go for self-discovery before self-development! We get so busy improving ourselves without even considering who and what we’re improving!
That “thing” is out there. Look for it . . . acknowledge it . . . treat it like the gift and gem that it is: the shining light of your truth.
Don’t be afraid. No . . . go ahead and be afraid. Just take the steps anyway.
“We cannot discover new oceans until we have the courage to lose sight of the shore.” - Gide
Start rowing … and by the way, the oars are out in the garage, so you’re going to have to get out of bed anyway. Jump!
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November 20th, 2008 categories: Seller Financing
This is the time for note professionals to shine. Our expertise can make a meaningful contribution to the economy.
I got an email from Kay, who found me as a result of an Investor’s Business Daily interview: Seller Financing Can Seal the Deal in Rough Market. She was thrilled, and so was I, that we only lived 5 miles apart. (It’s always fun when you get to work with people in your own back yard).
She and her husband had an escrow that was falling apart, and they asked me to step in and put it back together. If this deal didn’t close, then they would most likely lose at least another $50,000 on this southbound investment.
Here’s the scoop:
A British buyer had originally made an all cash offer on a $764,000 home. He put down a non-refundable deposit of $24,000, and was willing to walk away from it when the pound dropped substantially against the dollar, virtually overnight.
For him to liquidate enough of his own currency to complete the deal right now would effectively make his purchase price $900,000, and that didn’t mix well with his Earl Grey.
The sellers and I weighed the wrap (AITD) against subject-to and land trust transfer: seller financing on steroids – a technique to prevent the bank from being able to ‘call’ the note on any underlying financing left in place.
Here’s how the sellers made the transaction more palatable for the buyer and created a win-win-win-win-win (2 principals, 2 real estate agents, and 1 note pro):
Buyer made a $194,400 down payment, and took the property subject-to the sellers’ interest-only loan: principal balance $569,600, fixed at 7.25%. By George! Now he could put his focus back on the Breeder’s Cup!
As it becomes economically attractive for him to do so, he will liquidate pounds for dollars and pay off the underlying financing.
(After the holidays, won’t we all wish we could liquidate pounds for dollars?!)
I would have preferred that we had done a wrap (even if the interest rate was at par with the underlying financing). While both strategies are equally underwritten, the wrap would have given the sellers the right to foreclose in the unlikely event that the buyer quits making his monthly payments. Not that they would be willing to soak more money into the investment, but they would have retained more control.
The land trust transfer would have been watertight against potential loan acceleration, but the buyer’s financial strength made it an acceptable risk, so we elected not to try and educate everyone about this particular strategy.
Seller financing saved this Pasadena escrow and made everyone very happy: sellers got to sell, buyers got to buy, and agents made commissions. Now isn’t that some lovely jubbly!
- Very Scary Halloween Notes: Due on Sale (Santa?) Clauses
- Seller Financing and Land Trusts – Secrets of Liquidity After PTSD in the Real Estate Marketplace
- Why not sign up for the feed?
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November 17th, 2008 categories: Seller Financing
I forgot to mention that I will be having a couple of guest authors from time to time that will make contributions to this blog. The first one came out yesterday, written by Jerry Hannan, a very dear friend of mine.
I’ve been nurtured by the inspirational messages that he sends out every morning to his long list of subscribers, as well as by his powerful and generous essence and presence in my life for the last 3 years.
This is a Note Queen blog, and there are many different types of notes. I think we need “Inspirational Notes” just as much as or more than marketable real estate notes and creative real estate solutions. He’ll be adding a weekly inspirational note, probably each Sunday (so if you don’t go to church at least you have something to help save your soul) JK
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