Owner Financing to Make LOADS of Money Investing In Real Estate

When you are a real estate investor, you need to consider all available options for buying or selling new properties. Owner financing is also known as seller financing.

Now let’s talk about owner financing or some may call it seller financing owner financing is probably the most common term but seller financing is just the same it’s used they’re used interchangeably and i want to show you how i use it in my real estate business and how you can do and make you so much money because you’re not utilizing banks you’re doing everything

Differently than normal people would now my name is dustin heiner with master passive income i help people to quit their job by investing in real estate rental properties so they never ever have to work a job again and that’s what i want to do for you i want to show you how to do that and we do this by investing in rental properties that make us two hundred and

Fifty dollars or more every single month and the way we do that is we calculate our expenses we calculate how much we could rent the property for and we make two hundred fifty dollars so its expenses money your income money sure expenses that difference is your passive income and i want to show you how to invest in real estate and buy rental properties and make

$250 or more every single one i want to give you my free course if you go to master passive income comp or slash free course it’s all one word for it slash free course i will give you my free real estate investing course well show you how to analyze deals how to find properties how to make sure you scale your business so you can quit your job and everything about

It and even have the best out of state how to find the right property matter is everything you need go to master passive income com4 slash free course get my free course so you can get started now i want to talk to you about owner financing and how amazing owner financing is and some people might say well it’s hard to find owner financing well honestly it kind of

Is because there’s less or there’s fewer properties that are with owner financing or seller financing but at the same time they are out there and there are strategic ways to actually find the seller financing now before we get in how to find it let’s talk about what the seller financing and owner financing actually is so remember if you’re gonna buy a property

You’re gonna get a mortgage and a realtor and your mortgage broker and a realtor you’re putting together you’re gonna buy a property well normally we think we have to go through a bank to buy a property most of us don’t have a couple hundred thousand dollars of cash to buy a property so we would go to a bank now the bank would give us a loan basically give us a

Note a more on that property and we’d have to negotiate with them you know how much we’re gonna pay every single month by how much interest we’re gonna be paying and where interest rates gonna be how many months or how many years what’s the term of the loan all that how much down payment we’re going to negotiate all that sort of stuff that you’re going to need

To do in your business when you’re buying your property now with seller financing it’s basically getting financing where you’re using the property as the bank and the owner as the bank they’re going to finance the property for you just like they are the bank so let’s say that property is worth $100,000 the seller the owner is saying you know what i want to sell it

To you we’re gonna have a have have to have a down payment i will give you an owner financing note i’m gonna give you a mortgage for now what they’re gonna do is they’re gonna you’re you and them you’re gonna negotiate out how to basically everything about the mortgage the note that they’re gonna be giving you now and i could be a bank it’s not gonna underwriting

Like a bank there’s so many issues with underwriting which is the company and the bank trying to analyze everything and make sure that you’re you have the right debt to income ratio and all that sort of stuff but owner financing you don’t have to worry about that you don’t even have to worry about your credit score the owner is the one saying yes i’m going to allow

You to buy this property and pay me overtime as if i’m the bank so there’s a few things you’re gonna want and you’re gonna need to negotiate with the seller or the owner number one would be the purchase price obviously you got to know how much you’re buying the property for another one would be how much the down payment would be you may even have a owner saying

You know what no down payment we don’t need a down payment we just were interested in the monthly so you would have a no down payment that’s possible you might even have 10% 5% or just they might say give me a $10,000 that’s a down payment the rest we’re gonna finance the next thing is going to be the interest rate of the loan so whatever you’re borrowing how much

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Interest is gonna be attached to that another one is gonna be how long what’s the term how long is the mortgage gonna be is it gonna be a 10 year a 15 year a 30-year note you want to make sure that you have that all accounted for because you need to calculate how much you’re gonna be paying every single month another thing that you would want to consider is any

Seller concessions or financing concessions where the seller says well i know that needs a new roof in the next you know two years i’ll give you a half the credit so it’s $3,000 to $6,000 to actually fixed it and repair the roof and get a whole brand new man put on will give you $3,000 credits and so that’s gonna be a concession so that could be something that you

Can talk to them about it’s a little tip i want to give you all the ones are any title work who’s gonna be paying for the title fees and the closing costs that might be wrapped into the loan you might be able to do that too but you need to negotiate negotiate that as well so also who will pay it not just where are you doing the title and and everything but who’s

Gonna pay those closing fees and the last one is if you’re going to have to refinance the property afterwards and now not just refinance let’s say that the owner another thing you might negotiate is is there a balloon payment at the end of five years so you have a 30-year mortgage and it’s amortized over thirty years but in five years you have to make a balloon

Payment so basically that’s a couple big words but what it really comes down to is you have a 30-year mortgage with that that owner you’re gonna make payments as if you’re paying all 30 years on so aside let’s say it’s $800 a month for 30 years because it’s it’s the mortgage payments brought out over 30 years so it brings the price down or the mortgage payments down

To $800 well after five years the seller is saying after five years i want you to buy me out i don’t want to go the rest of 30 years i want you to give me a balloon payment and you might be thinking oh my goodness i had to come up with that cash no you don’t in those five years so you have 30 years say five years you just refinance in the middle there pull the

Cash out give it to or you don’t actually good it’ll basically be a refinance the money will go right to the owner just like you’re refinancing a mortgage exact same thing so that’s another great way if you have if they want a balloon payment don’t worry about the balloon payment we refinance it because it’s gonna be in your name you’re gonna have it and you’re

Gonna be able to talk to the bank and be able to move on a mortgage so that you can get that property out of the owner financing if you want to now if they want a 30-year note then great you’re gonna be paying them for 30 years which is fantastic because we’re not worrying about mortgages and all that sort of pmi private mortgage insurance all that sort of stuff

What worried about that we’re just working directly with the seller and with owner financing this can be done with anything not just real estate let’s say a car i don’t know i have never heard of many people doing this but it’s literally somebody else owns the car you pay them until a certain you get they give you a note or a loan on it basically and you paid

Them monthly instead of you actually paying them or getting a car loan from a bank it’s the exact same thing so if you want to buy real estate even if you want to buy land just raw land you can absolutely do that too now the question comes up is where in the world do i find these owner finance properties you know that’s not like the oh people are just waving a

Flag saying hey come over here well there are some great places to start number one the mls the multiple listing service they literally have inside the description they would if they already want to have owner financing as an option the owner would put in the description saying owner financing available or seller financing available or ask about owner financing or

Something like that so you can literally search for that just watch for those keywords inside the mls another one is talk to real estate agents talk to brokers real estate agents and see if they know of any any properties that are owner financing or seller finance because those are great ways to buy properties i’ll give you example i bought off of an investor three

Single-family homes and a duplex a oh and i used owner financing i gave them twenty five thousand dollars down and the rest in a cell or finance or an owner finance note know it’s fantastic about that is with that twenty five thousand dollars down that’s all i had to pay on my pocket now i had i was blessed to have enough money to buy those because i’m an investor

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But i was able to buy that now what’s great is i didn’t have to get a loan for anything else with buying it owner financing i am able to make fifteen hundred dollars a month in passive income from this property and once that note is paid off it’s because i’m getting monthly i’m getting money to the seller once that notes paid off i’m gonna be making about twenty

One hundred dollars on this entire deal from buying it it’s just twenty five thousand dollars down the great thing is it’s already rented these properties are rented that money coming in so whatever the balance is my tenants are paying that i’m not paying only pop money out of my pocket was twenty five thousand dollars that twenty five thousand dollars went to ten

The seller the rest of the thousands of dollars when okay it came from the tenants through me every single month to this seller it’s a fantastic way to go now another great way is through zillow.com through zillow comp check out this website now what you’re looking at is the website that shows basically all the listings as many as it can find everything from the

Mls the multiple listing service – for sale by owners foreclosures auctions they try to list every single property on here now i’m gonna give you a huge hack this is a huge tip that everybody most people won’t even think about but if you’re watching this as you fill in your criteria of what type of property you’re looking for click on the more’ button and it might

Change over time but click on it to where you can filter out the properties even more look down at the very bottom it could say keywords or description literally type in their owner financing or seller financing and click apply and see what properties that have that in the description that is gonna be the easiest way for you to look for properties that have owner

Financing from you know drinking coffee from your desk in the morning you know you wake up in the morning you look at y’all make some coffee look at a newspaper let me look for owner financing boom you’ve used a low and you have the ability to find owner finance properties now it’s up to you to negotiate with them talk to them and make sure that they are you know

All the negotiating of terms and all that sort of stuff now a question will come up is what type of contract should i use for owner financing well really it’s just a purchase contract basically you’re gonna put a purchase contract out with the owner and you’re gonna stipulate in their sell or financing on top of that what you’re gonna want to do is item eyes out

In that contract everything you negotiated from the purchase price the terms like how long it’s gonna be what interest rate what the payments are gonna be even put the amateur ization schedule that’s how much you’re gonna be paying every single month for the entire time how you know any balloon payments so our concessions all that sort of stuff you want to put

That in the contract but it’s basically a personal contract go to my website see the description where you can go and get my purchase contract on there as well so plus as area it’ll have everything written out an even much more so than i’m actually talking on on the screen right now and so go to my site because all you’re really going to is a purchase contract

And you’re gonna need the amateur ization schedule which i have that for you as well now you’re also going to wanna have the seller financing addendum it’s an addendum basically an attachment to the contract that’s where your amateur ization schedule that’s where your payments is basically a seller financing addendum sure you want to have as well now with that

You’re gonna want to be able to change the property from the seller into your name with a deed of trust and a mortgage with a promissory note a promissory notes basically a mortgage just like you would do with the bank they are basically you’re saying i’m paying this i own this property but i’m paying this guy this gal this owner this bank and if i don’t pay they

Can take back the property so you want to make sure you get the deed of trust put it in your name and have a mortgage mortgage on in a promissory note now you might be thinking you know is seller financing or owner financing a good idea for me and my business well absolutely if it’s done right it’s fantastic for your business you save loads and loads of money you

Get the tenants to pay for the actual purchase of the property so many great things about owner financing so in financing but the thing is that banks usually ask 20% down when you’re buying a property homeowners you can negotiate it said 20% they might say okay we’re gonna start at 15% you could say well how about 5% you work your way down to maybe 8 9 10 percent

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Down instead of the 20% or sometimes can be as high as 25% you can negotiate your interest rate you can negotiate all that sort of stuff that’s what’s great because banks they have underwriters they have people that look at the mortgage and they have criteria that they have to go by how much it must be how much what’s the dollar amount it must be like a minimum

Of $50,000 how much the downpayment must be how much your debt to income ratio which i talked about on my side go to there as well actually try to put that in the description as well the debt to income ratio and how that affects you so many other things that banks have to worry about what seller financing they don’t worry about that stuff yeah they can but you

Can negotiate all around that now i want to talk to you about little things that could be a little i want to talk about some things that you could be detrimental or that you could find as being oh man i wish i would not have gone to the seller financing or owner financing so let me show you the problems that can’t come up with owner financing if you don’t your

Mortgage this seller can repossess basically foreclosed just like a bank would on the property and get it back so obviously you have to pay your debts you have to make sure you pay for the the property every single month so they don’t go back and actually take the property from you you don’t want that another big one is if you try to buy a property that is not owned

By the person trying to sell you let’s just say and god forbid this happens you find a property somebody is listed on zillow for sale by owner owner financing great you think that this guy actually or this gal actually owns the property but she’s a shyster she’s trying to steal your money in fact i’ve seen this many times where somebody puts it on their for sale

Saying that they’re the owner you work with them you give them your down payment of $10,000 or whatever might be you go too close and it really realize that it’s not in that person’s name like they can’t they don’t actually own it it’s a scam so what you want to do a way to get out of that is making sure that you’re talking with the actual owner and then you do

Title search like title work which means you basically have a title company do the search on the title make sure that they are the actual owners and then they have the ability to sell it on top of that you have a contract if you don’t have a contract you don’t have it written down the bad thing is if you don’t have it written down it’s not enforceable because it’s

Hearsay it’s like oh his word my word or her word my word whatever it might be it’s not enforceable you need express written contract that shows everything itemized everything out and so you want to watch out for that as well another thing that you want to watch out for is that balloon payment that balloon payment could come due and all the sudden you’re like oh

My goodness the bloom bay but to do i don’t have any money well you should been refinancing it from day one you’re trying to figure out how to do that so those are some big things that you need to watch out for seller financing and owner financing but i’m going to say i love buying properties with owner financing so many hurdles i don’t have to jump so many things

I don’t have to worry about and i’ve even sold properties with owner financing as well because it was i was like shoot i’m gonna make if i sold the property right now i may make $80,000 but if i did owner financing i’ll make one hundred sixty thousand dollars my nose might as well do that i could use that money as a general income coming and pay for my food for

My kids so that’s everything owner financing so find those owner financing deals use that protip of of using zillow and type in their and the keywords in the description looking for owner or seller financing do that as well you’ll do really really well and don’t forget to get my free course my free real estate investing course where i’m going to show you how to

Invest in real estate analyze deals find properties do it right make sure you don’t lose money i’m gonna show you how to go to master passive income calm 4/3 course alright guys get out there start finding these owner financing deals they’re fantastic you absolutely need them in your business or i guess doesn’t hide her here with master passive income we’ll see ya

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Owner Financing to Make LOADS of Money Investing In Real Estate By Dustin Heiner | Master Passive Income