My 1st owner finance deal......suggestions, advice please

Hey all,

Got my first potential owner financed transaction on a SFR. I’ve done many o-f on mobile home deals but never on a SFR. Reason being is that the foreclosure process is to long in WI (6-9 months). Anyways I have one that I might just take on since its a smaller dollar amount.

Purchase for 19.6K with LOC
Selling for 30K on a land contract
15K down
Balance of 15K on a 20 yr amort. at 10% interest on a 3-yr balloon with a monthly payment of $144.75 a month.
Taxes are $1,237.00 or $103.08 a month
Figure ins. for them about $34.00 a month

All together for PITI they would be in the $281.83 range.

I have never done a SFR deal so I’m looking for pointers. My thinking is to do this deal with my lawyer, have him do the note, deed, etc. Title work will be done when I close on this property at the end of July which will save me a little bit for closing costs with my end buyer’s transaction. Who sets up escrows on this? Do they pay me the PITI and then I pay taxes at end of year? Run it thru a title company?


Wait, you found a buyer to give you $15k down or you are hoping to get $15k down on a $30k property?

As for your question, you have a lawyer draft a wrap around documents and then sign it with the buyer… the lawyer will do all the work and will charge you $250 to $1000 depending on the lawyer.

You hold the escrow and pay it, you can never depend on them paying it end of year.

Yes I’ve found someone with 15K to put down. I have a hard time squeezing 1K out of people let alone 15K.

This is a HUD that I’m closing on at the end of the month so there would be no wrap, correct? I would take the 15K and pay down the LOC and then use the rest of the money from my wholesale deals this month to pay off the remainder on the line.


That is why I was surprised, all buyers who call me want me to owner finance them with $500 to $1500.

As far as HUD goes, I assume you are buying it as an Investor not Owner Ocupant, if so, there are no rules that I know of to stop you from selling it any way you like. You can sell it on owner financing.

:cool HEY i say get the deal done with your lawyer and then sell the note off so then you will done and out of the deal asap :beer

With this small of note I would keep it for cashflow and get the backend profit with the balloon. I could use more cashflow :slight_smile: