1 / 83

GRAND-MA

GRAND-MA. By Dennis Henson. GRAND-MA Selling Upside Down Homes to Buyers who Can't get a Loan. By Dennis Henson. Seven Secrets of Success in Real Estate Investing. Get your mind right Seek Wisdom Develop Skills Make detailed plans Take massive action Form great alliances Be persistent.

Download Presentation

GRAND-MA

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. GRAND-MA By Dennis Henson

  2. GRAND-MASelling Upside Down Homesto Buyers who Can't get a Loan By Dennis Henson

  3. Seven Secrets of Successin Real Estate Investing • Get your mind right • Seek Wisdom • Develop Skills • Make detailed plans • Take massive action • Form great alliances • Be persistent

  4. 5 M’s of Real Estate Investing 1. Mining 2. Money 3. Maintenance 4. Marketing 5. Management

  5. Seven Secrets of Successin Real Estate Investing • Get your mind right • Seek Wisdom • Develop Skills • Make detailed plans • Take massive action • Form great alliances • Be persistent

  6. New--MAPS/IMAP/AMPS • Mortgage Assignment Program • IMAP Scott Horn • AMPS Phill Grove • Assignment of Mortgage Program • “Sell An Un-sellable House To An Un-loanable Buyer” Phill Grove • I decided to call it…

  7. GRAMPS Because it is NOT a new technique

  8. GRAND-MA is now… GRAND-MA

  9. What is GRAND-MA • “GRAND Mortgage Assignment” • GRAND-MA • The sale of a property where the Seller’s liens are accepted by a buyer in exchange for a deed of that property • Better known as “Subject To” (Sub2)

  10. GRAND-MA • Combines • An Option • Subject to • A Note • and a Wrap

  11. Is GRAND-MA Legal? • First rule of GRAND-MA • Always follow the law! • Ask your Real Estate Attorney • Work with an RMLO • But Thousand of Sub2s are done each year

  12. Why GRAND-MA Worksfor Sellers • Seller’s Problems • Behind on mortgage payments • Homes are upside down • Cannot afford the cost of selling • Undesirable choices • Need Cash to sell • Short Sale takes time & hurts credit • Can’t afford to pay a realtor to sell • Foreclosure • Sellers’s Solution = GRAND-MA

  13. Why GRAND-MA Worksfor Buyers • Buyer’s Problem • Anxious to own • Banks are not lending • Loans have been rejected • Buyer’s Solution=GRAND-MA

  14. Benefits to Seller • Solves their problems • Stops nightmare • Saves credit • Easy • You handle everything • $1,000 CASH

  15. Benefits to Buyer • Own their Own Home • No Credit Check • No Long forms to fill out • Very little paperwork • Quick Closing—Usually within weeks • Low if any closing cost • vs. thousands in a conventional purchase • No Points or Realtors Commissions to be paid • Monthly Payments are Fixed and Affordable • One Low Monthly Payment includes Taxes & Insurance • Probably No Pre-payment Penalty • Buying a home will help build credit • Help with refinancing is available

  16. Benefits to Investor • Takes little or no Money • Lots of Buyers and Sellers • Does not take much time • Is very rewarding • Can get started TODAY

  17. GRAND-MA Easy as 1 2 3 • Market to find deals • Get deal under Option • Marketing to buyers & close

  18. Finding GRAND-MA Deals • Use my “66 Ways to Find Deals” • Contact leads • Calling ads • Calling signs • Answering ads • Asking W-H-A-T Questions • See next slide

  19. Ask W-H-A-T Questions • What is it worth? • How much do you owe? • Uncovers GRAND-MA Prospects • Asking price? • Tell me why you are selling • Equity GO!!!

  20. Deal Analysis • Research • MLS or Fact Sheet • Tax Sheet • Comps • Repairs • TurboBidder2 Summary • Map • Killers • Bankruptcy • Too far behind

  21. Negotiating GRAND-MA • Are there other liens on the property • Are you willing to walk away • Have you considered a short sale • What if I could • Solve your problems • Save your credit • And pay you $1,000

  22. How to Make $ Using GRAND-MA Deals • Tie up property using little or no Money • Make changes to the liens • List and Market • Collect a check at closing • Possibly collect monthly payments

  23. Real GRAND-MA Deal 609 Nightshade Dr.

  24. 609 Nightshade Dr. • ARV 117-125 • Repairs 6K • 1ST 96K • 2ND 8K • 3RD 6K • 4TH 10K Total 126K

  25. 609 Nightshade Dr. • Sold 131,500 • Repairs 1K • 1ST 96K • 2ND Reduced to 1.7K • 3RD Reduced to 0K • 4TH Reduced to .7K • Selling Costs 4.5K • Profit $27,600

  26. Get Help • Real Estate Attorney • Title Company • RMLO • Realtor?

  27. Do I Need a Realtor • Realtors are not required but • But Realtors can be useful • Finding Deals • Researching Deals • Marketing Deals

  28. Forms Needed • Option • Note • Sales Contract/Subject to • Disclosures

  29. GRAND-MA Components • An Option • Subject to • A Note • a Wrap

  30. Option GRAND-MA uses an Option to tie up property

  31. Options may be Used to Control Property Options allow control of a property for a time • An investor may sell for a higher price • Sale price – Option price = Profit

  32. What is an Option A unilateral agreement: • Between an Optionor & an Optionee • Or Buyer and Seller • Binding only on the Seller • The Buyer has no obligation to purchase • But the Seller is required to sell • at the strike price • if the Buyer chooses to purchase • before the expiration date

  33. Elements of an Option • Price--to be paid for option • Time—when option starts & expires • Strike Price—purchase price of property • during the option period • Other terms and conditions

  34. Is this the same as a Lease Option? • Yes and No! • The Option is the same • But the Lease Option includes a Lease • The Option and the Lease are together

  35. Are Options Legal in TX? • Yes Options are legal in Texas • But when attached to a Lease=Problems • To avoid problems consult an attorney

  36. What are the Steps an Option Transaction 1. A Buyer and Seller enter into an agreement • The Buyer pays a consideration to the Seller • The Seller grants the Buyer • The exclusive, unrestricted, irrevocable purchase option • At a fixed purchase price • For a specified period of time

  37. What are the Steps an Option Transaction 2. The Buyer either • Sets up a closing • And buys property before the expiration date • Sells the option to another investor • Lets the option expire • by not purchasing the property in time

  38. Option Benefits • Saves on closing costs of buying & selling • Saves holding costs • Maintenance • Taxes • Insurance • Other costs • Saving time • Applying for Loans • Setting up closings • Going to closings • Put time to better use • Finding more deals and money

  39. One More Thing • An Option expires on the expiration date • Unless renewed or exercised • At expiration • Buyer loses control of the property • And their original option payment

  40. Subject To • No Credit Check • No Loan Apps • No Waiting • No Closing Costs • None of Your Own Money • BUT • A Bank is involved • There can be stress • Proceed carefully

  41. “Subject To” Means • Subject to the existing mortgage “To purchase property subject to a mortgage on the property. The purchaser assumes no liability for repayment of the mortgage debt. The only money at risk is your equity.” Carleton Sheets

  42. Overview • Old Lender note remains in place • No liability for the underlying loan • Foreclosure will not effect buyer’s credit • Buyer is not obligated to pay bank loan • There is only a moral obligation to pay

  43. Why Sellers Agree • Foreclosure • Sickness • Death • Divorce • Job change • Behind on payments • Old age • Inheritance • Had to move • Immediate need for cash • Don’t want any hassle • Live in another part of the country • Tired of dealing with renters • Lots of other reasons

  44. Concerns • Is This Legal? • The “Due On Sale Clause”? -> • What if I fail to make the payments? • Bank Communications • How to be sure payments are credited? • How do I get Pay Off information? • Escrow Concerns • Insurance • Taxes

  45. The “Due on Sale” Clause • The most common question— • "What about the Due on Sale Clause?" • Scares both buyers and sellers • Can and does kill deals • The lender • can declare the note due • has the right to foreclose • But--the Federal Government will punish the lender for having a "bad debt“

  46. Bankruptcy • Stop • Don’t do Subject to • if seller is filing for bankruptcy

  47. Monthly Payments • You have a choice • pay the mortgage or • lose the property by foreclosure • But where do you get the money? • Lease Option • Rent to Own • Rent

  48. One More Thing • On an FHA insured loans— lenders are required to receive HUD for permission to foreclose a mortgage on a property transferred without paying off the loan (or “Subject To”) • As of this research--there have been no reported cases where HUD actually gave that permission

  49. How to Setup • Add • Subject to Current Mortgage • To the sales contract • Have an Attorney or Title Co. • Prepare A Special Warranty Deed • Have seller sign • The contract • The special warranty deed • Listed additional insured on Policy • Insurance policy changed to landlord policy • Change address of seller to yours at bank

  50. Notes

More Related