YES they are in some ways but not in others !!! YES you can get the downpayment and carry your note for a month or two it is your note !!! IF after a few payments you want to sell it you can !! THIS is called selling your note /// discount is set by buyers fico and terms of the note and lastly amount of down payment !!! DOWNpayment shopuld be at the least 5 % intrest should be at least 8 %
You are turning out to be pretty helpful and I do thank you for answering even some of the most common sense questions, which I tend to be lacking in from time to time :anon
My latest idea, as I dig further and further into this real estate adventure, is to create notes and sell them…
It seems to me an easy way to sell rather than letting homes sit on the market forever, which they tend to do in this area.
SO. Ive got questions…
My original plan was to use owner financing with a downpayment, no credit check, no interest. (I know, WHAT???) I figured I would just jack the price of the house up and that would make up for no interest.
I have now come to believe that this MAY not make a desirable note to an investor. he he.
So , my questions…
Do I HAVE to do a credit check? Will no one buy the notes if I dont?
If I do it the way I described above, Will investors not touch them?
Does it matter to investors(note buyers) if I have a note for 40k and the house is only worth 20K/ will they still buy it ??
4. THe note buyer is actually aquiring the deed and taking my place as the real owner?
5. Where do I get a contract for this?
6. what things need to be added to the contract (buyer may assign contract? Buyer may sell contract? etc).
You need to do a credit check. Charge the buyer $25 to do a credit check. They are easy to do. Someone buying the note is going to base their offer to you on the borrower’s credit, how long the loan has been seasoned and the interest rate.
Note buyers don’t necessarily care as much about the equity so much as the interest rate. If you have a loan at 0% interest rate, expect a very low offer for your note.
The buyer of the property is the owner of the property, you are the lender. So if you sell your note, the original buyer is still the owner, however the note purchaser is now the lender.
:cool lorik not all note buyers care about the age of the note SOME will buy right at the close !! BUT you are right some where in the mix a credit check is and will happen !!! MOST people we deal with do it at the time they buy the note :beer
So how would i do a credit check and what is good enough for a note buyer along w/ 5% downpayment & we’ll say 10% interest?
also what is a general idea of what a traditional lender (bank) would say is good enough credit to loan?