Thank you for giving a clear definition of what they mean. I'm a newbie and just started to learn the terminology of REI jargons. Thanks for clarifying.
Great video. If I purchase a property via seller financing. I could present the deed and loan agreement to a bank to refinance? What about a Land contract?
In a land contract, you don't have the deed until it's paid off. You can still get bank financing to purchase. It's just not a refinance. Hope this helps!
Usually, the seller adds the monthly taxes and insurance totals to the buyer's monthly payment and will add the buyer as a second insured on their policy. Hope this helps!
On a lease option, why would I rent my home out at the regular rental rate when I can just do that and not have to sell my home? Isn’t the whole point to get more cash flow upfront? Aka higher than regular rent? And the extra goes to their deposit?
It's not really about just the rent amount and cash flow. It's about the non-refundable down payment and the backend sales price. You want cash flow but I rarely increase the rental rate for someone.
You are welcome. A Land Contract is only good for the seller who doesn't want to give away the deed. In some cases it's a good thing, this would avoid the due on sale clause.
Hey, great stuff Chris. I'm still having a hard time understanding the "escrow" portion of the payment to seller using seller financing. If I understand correctly, escrow include taxes and insurance but wouldn't I as the buyer be assuming that cost? If so, why would I be paying the seller that on top of principle and interest?
Yes, when seller financing, you own the home so you are paying the taxes and insurance. There are 3 ways to pay... you can pay them on your own, not to the seller. Second, you could make the payment to the seller and verify that they paid. Third, you can have an Escrow company handle the payments for everyone. Most people would elect for the third option. You will find a lot of mortgages today where the taxes and insurance are included in the monthly payment. A seller that seller finances a property, could technically do the same thing with you. There are several ways to work these deals. Hope this helps!
With a contract for deed, you don’t receive the deed until you pay off the debt. It’s like a car, you don’t receive title until it’s paid in full. Hope this helps.
@@ericstugart6134 Hundreds of times. Your exit strategy is based on how YOU want to profit and how the numbers work out. We use our deal analyzer in REIPro and to analyze all of this.
Thanks Chris
Thank you for giving a clear definition of what they mean. I'm a newbie and just started to learn the terminology of REI jargons. Thanks for clarifying.
Appreciate the comment, and you're welcome! You should join us on our next webinar: chrisgoff.lpages.co/deal-analysis/
Excellent content
Appreciate that!
this was awesome! thank u!
You are very welcome, and I'm glad it was helpful. Don't miss out on new videos - subscribe now!
Great video. If I purchase a property via seller financing. I could present the deed and loan agreement to a bank to refinance? What about a Land contract?
In a land contract, you don't have the deed until it's paid off. You can still get bank financing to purchase. It's just not a refinance. Hope this helps!
In a land contract does the buyer pay insurance on the property also
Usually, the seller adds the monthly taxes and insurance totals to the buyer's monthly payment and will add the buyer as a second insured on their policy. Hope this helps!
I live in ATL will you be doing an event soon??
We are planning on doing events next year and the ATL will probably be on the list.
On a lease option, why would I rent my home out at the regular rental rate when I can just do that and not have to sell my home? Isn’t the whole point to get more cash flow upfront? Aka higher than regular rent? And the extra goes to their deposit?
It's not really about just the rent amount and cash flow. It's about the non-refundable down payment and the backend sales price. You want cash flow but I rarely increase the rental rate for someone.
@@ChrisGoff how much down payment are you collecting?
Omg you just saved me! The seller is trying to push me into a land contract.
You are welcome. A Land Contract is only good for the seller who doesn't want to give away the deed. In some cases it's a good thing, this would avoid the due on sale clause.
Hello Chris , what would be a seller finance scenario be if the seller still has a mortgage?
The same, you just have to account for the existing mortgage and use a wrap with a sub-2.
Hey, great stuff Chris. I'm still having a hard time understanding the "escrow" portion of the payment to seller using seller financing. If I understand correctly, escrow include taxes and insurance but wouldn't I as the buyer be assuming that cost? If so, why would I be paying the seller that on top of principle and interest?
Yes, when seller financing, you own the home so you are paying the taxes and insurance.
There are 3 ways to pay... you can pay them on your own, not to the seller. Second, you could make the payment to the seller and verify that they paid. Third, you can have an Escrow company handle the payments for everyone. Most people would elect for the third option. You will find a lot of mortgages today where the taxes and insurance are included in the monthly payment. A seller that seller finances a property, could technically do the same thing with you. There are several ways to work these deals. Hope this helps!
I'm confused, how is Seller financing as you explain in this video different than a Contract For Deed?
With a contract for deed, you don’t receive the deed until you pay off the debt. It’s like a car, you don’t receive title until it’s paid in full. Hope this helps.
What are your thoughts on getting a deal via seller financing and then doing a lease option agreement to someone as an exit strategy?
You sure can!
@@ChrisGoff have you ever done it?
@@ericstugart6134 Hundreds of times. Your exit strategy is based on how YOU want to profit and how the numbers work out. We use our deal analyzer in REIPro and to analyze all of this.