Hello, I am new to the site and still in my education phase. I have listened to most of the audio files available on this site, including John Locke’s on Sub 2. Here is my question: When you buy a house sub2, and then subsequently sell it with a down payment and owner financing as taught, how do you protect yourself should the person buying the house from you trashes it. If they give you, say, 5K down, but do more damage than that before they walk. Is that just an inherent risk?
Thats one of the risks of this business!!
Glad to meet you.
I can honestly say I have never had a buyer trash a house because they could not pay me. One of the main reasons is what we provide a seller who is credit challenged with the American Dream of home ownership and number two when they put enough down they feel pride of owning the property.
Should my buyer run into a problem, then I immediately am at their door not in a confrontational manner but as someone there to help. I guess you could call them Motivated Movers at this point and just as we handle Motivated Sellers we talk with our buyers to find out the problem and if they cannot pay then we move onto, well folks how about I give you some U-Haul money to move out and get your life going again. This has always worked as the majority of people in these type of situations look at $1000 dollars as $1 Million dollars when they are broke, guess someone has had to have been there to realize what I am saying.
However, they don’t get the money until they are packed and ready to move (they certainly are not going to trash the house knowing I am going to show up with moving money), in other words just don’t sit back and wait for something to happen make it happen and offering money to move works very well, then the house will stay in the same condition as you sold it.
One last thing most folks who purchase (CFD or Wrap) feel true home ownership (not sold lease option they are tenants) fix up the property, I have had buyers put in pools, new roofs, new carpet, etc., before they re-financed the property. Some folks reply it is a Risk while others no how to eliminate the Risks when doing Subject To deals.
John $Cash$ Locke
John, thanks for the reply. I enjoyed your audio presentation.
The reason I asked the question is I have had several friends/acquaintances who have had bad experiences renting property. I guess what you are saying is, because you are giving someone an opportunity for home ownership they wouldn’t otherwise have, they will not have a renter’s mentality. That, along with your gut extinct when you meet with the people to do the deal?
That makes sense. Thanks again.