especially as I’ll be seeking seller financing to acquire most of my properties in the beginning.
As a consumer of services and debts that you pay on a monthly basis and require accounting for which you get in statements and online access, I’m confused as to how an individual is supposed to provide that level of accounting in a note they created on their own. I’m sure I could figure out a system for mysel but why would anyone trust my records. Also are there rules/guidelines one must abide by when creating a promissory note?
And would I set these up as a seller AND a buyer? If someone suggested I finance them to buy my house at a low to zero interest rate and down payment(as an investor would require) my first, or second thought would be ‘hmm, and I’m going to keep track of that, or trust this guy off the street to do it.’ Or do investors usually pay some third party to handle debt collection because I never hear about those costs, btw what would they be around? Thanks!
Hi,
When you purchase real estate your promissory note and deed of trust are handled by escrow, the seller will probable want you to make your PITI payment to a escrow servicing account.
Your seller financing (If Any) is probable not transferable to your end buyer and your probable going to want your profit as an investor out when you sell.
Your not going to get a zero or low interest rate on private seller financing as your likely to pay 8 to 12% on debt over and above wrapping existing mortgage financing.
Expect to have something in the deal cash, whether it’s just closing costs and / or something down as it’s really hard to get 100% financing and most sellers expect you to have some skin and good credit in the game!
Good luck,
GR
Thanks GR.
8-12% ? How did you figure those numbers?
So an “escrow servicing account” is what you use to collect payments and keep track of amortization and delinquency and so forth on your personal (business) loans?
And do I just take over the seller’s escrow account pertaining to the taxes and insurance part of the piti?
As the seller financing, again do I just use the existing escrow account and xfer to my buyer?
And if you’re saying I’m going to be paying between 8-12%(is that like, “subject to”?), what would I be looking to charge my end buyer? Up to the federal limit as possible? Something under? I might not even know enough to know what I’m asking here sorry. It’s more of an ‘are there any answers you think I might need here’ request. Thanks