Another Money Making Partial Technique - Continued
Go
to PARTIAL
TO PARTIALS to learn how to make a bundle and increase
your yields to astronomical levels.
In
the last issue, I pointed out some tricks note buyers will
use to try to convince you that you would be selling your
note for no discount. If you want to learn the exact math,
go to FOR
THE GREEDY ONLY, and DOUBLE
YOUR YIELD WITH HALF AND HALF. There are note buyers
who make a fortune from these techniques.
Now
the NOTE PROFESSOR will give an example where it
makes sense to sell a partial of your note. Suppose you
are a rehabber who bought a property for $30,000. It took
you $10,000 to rehab, and you are trying to sell it for $70,000.
You have found a buyer, but because of seasoning, appraisal,
or the credit worthiness of the buyer, they cannot get
financed. You have a hard money loan that is eating
you up like Pac Man, and really just want to get out
from under and move on. What can you do.
Why
not sell the property for $70,000 with the buyers putting
10% down. (Demand more if need be. Remember, the more down,
the more money in your pocket) You will then carry
a note for $63,000 @ 10% for 30 years. This will make the
payments $522.87. Since you just want out, you determine
how many payments you would have to sell to give an investor
a 12% yield, where you would break even. With your handy
dandy friendly neighborhood financial calculator you determine
you can sell 96 payments, or 8 years, and receive $34,016.83.
Combine that with your $7,000 down, and you have practically
broken even. At the end of 96 months, the balance of the
note of $58,925.92 will be yours. Go to PARTIAL
TO PARTIALS and HOW
TO DETERMINE THE BALANCE OF A LOAN to see how to arrive
at these figures. Yes, I know there are closing costs, I am
showing concepts here. In the real world you would
determine all costs before selling your note. When I go to
sell a note, I always ask what can I sell a partial for.
Often times it just makes more sense to sell only a partial.
For
example, if you want to know how to acquire NOTES FOR FREE,
to put into your retirement fund, go to HAPPY
TAILS TO YOU. This is nothing more than another
way to utilize partials for big profits.
What can be more profitable than having no money into it?
As
always, remember there are tax and legal consequences to buying
and selling notes. If you do not have a competent tax and
legal advisor helping you, you ought to be taken out of the
investing gene pool.
HAPPY
HOLIDAYS.
Here ye, here ye. I am putting THE NOTE
PROFESSOR NOTEBOOK on EBAY for the HOLIDAYS. It would
be the perfect Christmas Gift for investors
Then
you can borrow it? J Just go to EBAY and type in NOTE
BUYING. If all have been purchased, try again in a couple
of days. To save on expenses, I am putting only a few for
sale at a time, so keep checking.
If
you have any questions, please contact
me. It is from your questions, that I get the material
for my articles.
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© H&P Capital
Investments LLC All rights reserved
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