Workshop: Saturday September 12th 8:30 to 4:30 Johnson County Community College, Overland Park, KS
Dear Kim ,
I have had the privledge to listen to a lot of the top earning real estate investors across the county. Yes they all make money in different ways with real estate, but the one underlying theme for almost all of them is to buy real estate from motivated sellers while leaving the seller's underlying mortgage in place - buying the houses SUBJECT To the existing financing. No Bank Loans, no points up front, no appraisals, none of the fees that eat up a ton of profit.
Then these same investors resell the house. They offer homes up for sale at a premium price because they are willing to wait a bit for their buyer to get financing. They may sell the home on a Lease to Own Contract or a Contract for Deed, and in some cases they might offer Seller Financing. No banks needed immediatly for the buyer. Thus giving the buyer time to improve their situation and get a better loan in a few months to a few years.
Like I said above, I have seen almost all of the very wealth investors I know locally and across the country employ this method and right now, in today's market, where the banks don't seem to want to lend money to anyone, except first time home buyers it's an almost perfect strategy.
Let's say you find a motivated seller with a house that is worth about $150,000. They owe $120,000 and have already moved to another state for a new job, they don't want to come back to sell. It's been on the market for 6 months to a year and is in ok shape, but could use a little sprucing up. Their mortgage payment is $650 a month. You buy subject to the existing financing, take over their $650 a month payments and give them $3,000 down.
You in turn offer for sale at $140,000 on a lease to own. Buyer just needs $4,000 down (covers your $3,000 and puts $1000 in your pocket) and they will pay $800 a month (thats $150 a month in your pocket). And the end buyer is responsible to do the sprucing up.
You now have $1000 in your pocket and are getting another $150 a month in positive cash flow. And you hook the end buyer up with a lender who works with them to improve their credit and get them a loan in about 18 months where you ned another $15,000 or so after fees.
This is a very simple concept, but a lot of people make it very hard. So I wanted to be able to bring someone in who is not a fast talker, who explains everything in a simple to understand manner and my good friend William Tingle from Macon Georgia fits the bill. He will be speaking on Tuesday September 8th at the MAREI meeting to give you a very fast instruction on what he calls Sub 2, then he is going to stick around and see the sites for a few days and then teach an all day workshop on Saturday.
Learn:
How to find the sellers willing to sell Sub 2
What are the best marketing tools to find sellers
How to put a Sub 2 deal together - the mechanics
What kind of end buyers to look for and how to find them.
Event is $25 for members of MAREI and $35 for non members. Seating is limited and with almost 2 weeks left we have sold about 1/2 the room. If you want to attend please register now.
Kim Tucker
Director
www.MAREInet.com
816-523-4400
