Posted by jennifer on October 31, 2008 at 10:25:56:
I own 7 quads that I have purchased over the past 3 years. A bank is selling a foreclosed quad that is listed for $168k. I want to purchase this property but am hobbled by the recent 4 investor loan limit by Fannie Mae and Freddie Mac. My goal is to write a note for $168k, sell it to somebody for cash and then give that cash plus the difference between the cash received and the $168 purchase price to the bank to purchase the property. Then turn around and start making monthly mortgage payments to the person who bought the note. I want to use the note as source of funds to purchase the property.
My partner and I own 7 quads and we have the experience in rehabbing them and renting them out. All of our properties cashflow. Our middle credit scores at 711 and 745. We both have stable jobs (we dont do real estate full time it is just a part time job for us). We would be a solid picture for someone to work with us on a note.
The tax appraised value of the quad is $340k but in all honesty that is overpriced. This is a down economy and properties are not selling right now unless they are bank foreclosures at way below market value. The other 7 quads we purchased were at $320k, 309, 314, 334, 300, 240, and 265. If you use market value of $300k then the purchase price of $268k is just 56% LTV. The note would be a 1st mortgage.
We are not flippers. We plan on holding this until loan is paid off and that will give us an annuity stream of rental income in our retirement.
Now that I have given background of the deal and ourselves, can someone tell me if it is possible to basically create our own note, sell it, buy quad and then make payments to buyer of note? Or anyway to structure this deal so we can jump on this deal?
- Purchase money Notes... Michael Morrongiello 20:42:11 11/02/08 (0)
- Re: can you do this with a note? brandoncsbre 05:47:20 11/02/08 (0)