| I am well known for saying: I don’t buy properties, I | | | | put on his own personal house and has $30,000 in the |
| buy problems - I acquire the properties since they are | | | | bank but needs $50,000 from the sale to avoid having |
| attached to the problems. I solve the problem and | | | | any loans associated with the addition. |
| make money. Problems may be with the owner(s) | | | | 2. His brother wants to buy a new Porsche for |
| personally, the property itself, or the title to the | | | | $45,000. He is just going to blow the money all at once! |
| property. With this win-win attitude you will succeed | | | | 3. Their Sister has some credit problems and owes |
| much more than the person who is only looking out for | | | | about $41,000 in credit cards She is planning to use the |
| himself. | | | | money to get out of debt. |
| Thinking creatively in these situations is essential. | | | | How can we make it work? |
| Realize that No Money Down might not mean No | | | | |
| Money Down but None of YOUR Money Down. In | | | | 1. On his behalf, use your negotiation skills with his |
| other words, put someone else’s money down for | | | | contractor who will be building the addition. Possibly |
| your real estate acquisition. Use "OPM" (Other | | | | supply materials for the contractor bought on your |
| People’s Money). | | | | credit card or credit line. Possible result: $13,000 saved. |
| Learn how to balance price and terms when | | | | 2. For his brother, use your negotiation skills with the |
| negotiating a purchase or a sale. If you are buying and | | | | auto dealer to get a lower price, and possibly finance |
| the seller is firm on his PRICE then negotiation must be | | | | the new Porsche with your good credit. Possible result: |
| under the Buyer’s TERMS. If the seller does not | | | | $7,000 saved. |
| want to entertain creative terms, then he must move | | | | 3. For his sister, negotiate with the credit card |
| on the price. Take a look at the following examples: | | | | companies or work with a credit counseling company. |
| 1. The seller is stuck on a $200,000 sale price. | | | | Possible result: $22,000 saved. |
| | | | 4. The total of these is a possible result of saving up to |
| 1. Lender loans $170,000 for new first mortgage. | | | | $42k cash. |
| 2. Seller holds $20,000 in a second mortgage (terms) | | | | They can hold three separate mortgages for $36,000 |
| 3. You put down $10,000 cash | | | | each. Then, your payoff is the amounts you have |
| 2. Three siblings have inherited a free and clear | | | | successfully negotiated. You then apply to a traditional |
| property and they do not get along. They are | | | | lender to refinance the lower mortgage balances |
| demanding $50,000 cash each, bringing the sale price | | | | totaling $108,000. |
| to $150,000 FIRM! With repairs, the house will be worth | | | | That’s a good deal! Here’s a better deal: The |
| $200,000. | | | | sellers jointly hold one single mortgage for the entire |
| Repairs needed: | | | | amount of $108,000. You reduce the payoff of the |
| Roof $15,000 | | | | mortgage the same way mentioned above. Then |
| Windows $5,000 | | | | sometime in the future, you tell them that you are |
| Paint $5,000 | | | | coming into some money within the next month. If they |
| TOTAL $25,000 | | | | can agree to take $80,000 for the balance, you tell |
| Estate Appraisal is $135,000 | | | | then that you will have all their cash within that month. If |
| What questions should I ask? | | | | not, they have to wait out the terms of the mortgage, |
| I ask the brother who is handling the transaction what | | | | which you negotiated to be the longest time possible. |
| he and his siblings are going to use the money for. | | | | This saves you another $28,000. I have used this |
| | | | method many times. Total savings on this deal |
| 1. He says that he is going to have an $80,000 addition | | | | $70,000.00! That’s a 40% savings! |