Archive for June, 2009
Are There Sellers Offering Seller Financing in my Area? I Only Need Them to Carry for a Year
June 22nd, 2009 categories: Seller Financing, Selling Your Note
As good as the financing can be these days, there are still good buyers who fall through the cracks. Here is an email from one:
“Dear Dawn –
We are looking to buy a modest property in Evansville, IN (about $100-120K). We have a 10% down payment, a solid income, and have been told that our credit would qualify us for a VA loan in about one year.
We recently sold our home in Indian Wells, CA — no foreclosure, no bankruptcy, although plenty of delinquents the past three years due to a medical crisis. We had a tax lien and judgment lien, and those were satisfied at the time we sold our home.
“Seller financing” is not well-understood out here. Right now, we’re looking at a couple of homes that are 50% more expensive than the type of house we want and need only because those are the only ones where the Seller — out of desperation — is willing to carry for a year.
Any chance that you know of anyone who would be interested in buying the note in a seller-financed transaction here in Indiana that would allow us to get a house we REALLY want that is far cheaper than what we may have to settle on?
Thank you, Ren”
Dear Ren,
What are your FICO scores? If above 600, then there may be a simultaneous note sale program that you would qualify for. There would still be some educating to do, as all parties involved usually need some guidance and clarification, but it’s possible to create and then sell the note created with minimum discount (.85 on the dollar).
Once you have a property in mind, you will need to present an offer for the seller to consider, and you will need to see if you qualify for the simo program by turning in a 1003 and paying for credit reports.
Alternatively, if you find a seller who has great underlying financing, you may want to leave it in place by using the title holding land trust transfer.
I am available to consult with you regarding your individual situation by the hour or by flat fee. The flat fee of $495 covers you until you successfully consummate a transaction, including talking to all parties involved until everyone is on board.
Best wishes,
Dawn
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A Note from Jerry …
June 21st, 2009 categories: Seller Financing
How are you being today?
If you’re reading this (and I’m pretty sure you are), you’d better get down on your knees and thank All That Is that you are right here, right now … a part of it all!
Could your life be any more exciting and thrilling than it is right now?
Ok … How?
Let’s get busy on creating that!
Be you.
Jerry
“Bad times, hard times – this is what people keep saying; but let us live well, and times shall be good. We are the times; such as we are, such are the times.” – St. Augustine
We are the cause and the solution!
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Can I Sell a Business Note?
June 17th, 2009 categories: Seller Financing, Selling Your Note
Yes! It’s very common for business owners to carry a portion of the sale when selling a business, and frequently, the note can be sold after 6 months of seasoning (this can be less in certain circumstances).
People selling business notes need to understand that typically, there are significant discounts involved, so if you’re not prepared for a 20%-50% discount (depending on all factors involved), then you’d be better off waiting out the term.
To set up your note and transaction ahead of time so you have a note worth as much as possible, you’ll want to consider hiring me to help you put your deal together.
The basic info I’ll need to start working on your business note:
- type of business
- location (city & state)
- sale date
- how note created (seller carryback?)
- sale price
- down payment
- original note balance
- interest rate
- term
- payment amount
- lien position
- payor onwership structure
- payor credit rating (D&B if applicable)
- personal guarantees
- value of hard asset collateral (tangible and intangible)
- value of intangible ’soft’ asset collateral
- goodwill value
- if real estate included (zoning factors, usage, operation history including NOI past 5 years, any other liens and their rate/term/balance, debt coverage ratio)
These are the documents I generally need to get started and that help me put together the above:
- copy of the note (front and back, or allonges) – be sure you keep the original note handy
- copy of the security agreement – you’ll need the original
- copy of the purchase agreement if purchase-money note
- copy of the bill of sale
- copy of closing statements related to creation of the note
- copy of the appraisal, if any
- copy of the payor’s original credit application and credit report
- documentation of payment history
Potential fees that the note seller MAY be required to pay in order to sell:
- UCC search fees
- credit report fees
- appraisal cost
- corporate records search fee
- legal research cost
- background investigation cost
- field research cost
Let’s get started! I’d love to work with you to ensure that you get the best price and the best service with someone you can trust. You can email or fax documents to (626)451-0454.
And don’t worry . . . the documentation requirements can seem overwhelming, but my associates and I will be here to help you every step of the way.
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