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Goal Setting

Advantage to Seller Financing

Seller Financing

Lease Option / Purchase

           Exchanging using Removing the            Blanket and Subordination

Goal Setting

  We all know the saying, if you keep doing what you have always
      been doing don't expect different results  

If you would like 2010 to be a great year make better plans

         Your life can't go according to plan if you have no PLAN!
                       If you Fail to Plan, You Plan to Fail

   The seven steps to goal setting

1.  Identify the Goal & Write down the goal ( be specific )
2.  Set deadlines, one month, two months, 1 year, ect. and set a completion date
3.  List all the obstacles you need to overcome in obtaining your Goal
4.  Identify the people, organizations, etc. you need to work with.
                                                                     "BE - DO - Have"
5.  List skills, knowledge, etc. you will need ( what kind of person do you need to "BE", to achieve your goal ) Most people think that they have to have something, before they can  do something, and then they can "BE" someone.  That is opposite thinking, you have to BE the right kind of person to DO what you need to do before you can have the things you want to HAVE.
Write down what you would like to "HAVE", then write down what you need to "DO" to have what you want to "HAVE", then write down what kind of a person do you need to "BE", to "DO" what you need to do to have what you want to "HAVE".
Develop a plan
6.  List benefits of reaching your Goal (Is this what is best for me and everyone I will be surrounding myself with)
7.  Make sure your goals are balanced. You need to set goals for Physical, Family, Financial, Social, Spiritual, Mental, and Career. Successful people know how to have balance in their life.

                 Ask these five questions about your goals:
    Is it really my goal? .
    Is it morally right and fair to everyone?
    Will reaching this goal take me closer to or further from my major objective in life?
    Can I emotionally commit myself to start and finish this project?
    Can I "see" myself reaching this goal?
    Visualize the Goals. When the outlook is bleak, remain positive.

Benefit to You –Making better plans and Working with motivated people will make 2010
                                                                 a very productive year.


Advantage to Seller Financing

Present Condition - As an investor you have purchased a single-family house at an excellent price, and now you are in the process of selling to a new buyer. 
In today's market the lenders rules have become very restrictive, keeping potential buyers from purchasing a home.
You have a buyer that is willing to give you your price, has a small down payment, and you feel very comfortable working with the buyer. 

Resolution – Seller Finance:  You create a Mortgage Note that works best for both of you. 
Example: The sales price of $165,000  - $10,000 down payment
Principle $155,000.00    Interest  7.5%    Term  30 year     Payment  $1,084.00 month

Benefit to Buyer – Buyer purchases a home with a smaller amount of down payment, then if he had gone to a lender with all of their restrictive rules. This allows the buyer to get into a home with the least amount of problems in the shortest period of time and also allows the buyer to spend the money he saved on his new home.

Benefits to You – You have a buyer that will provide you with several opportunities to make your investment successful. 
You have created a Mortgage Note that has a face value of $155,000.00 

You can do many things with this note, you can use it for a down payment on another piece of property.
You can use it an option, you can exchange for anything of value, or pieces of anything of value that  balances the equities. 
You can sell the note for cash now, you can sell part of the note giving you cash or something of value for the payments you sell.

Seller Financing

Present Condition – Lenders have tightened their lending criteria making it very difficult for a buyer to purchase your property.
The primary reasons they are not qualifying for traditional bank financing include:
Recent divorce, Medicaid problems, Credit problems, New on the job or to the area, Self-employment, High debt-to-income ratios, Not enough cash for a down payment.
There are these potential Buyers that do not have the opportunity to own their own property.

Possible Resolution – (Seller-financing) seller financing occurs when the Seller of the property allows the Buyer to pay part or all of the purchase price in the form of a Promissory Note, secured by the property or asset sold.
The Seller is becoming the Bank, which often makes a sale happen that would not otherwise take place. 
The Potential Market of Buyers is greatly increased many times over when a Seller, offers    Seller-Financing   

Benefit to Seller – Using Seller-Financing, the seller is able to get the best possible price, in the shortest period of time, with the least amount of problems and that is what most sellers are looking for

Benefit to Buyer – The buyer is able to purchase a home without having to go through the stringent lender qualifications.

Benefit to Agents - As real estate brokers, agents, business brokers, you know how difficult it is to find the right match of cash, terms and motivation in a transaction.
You know the Sellers only want to consider Seller-Financing as a last resort because most Sellers want their full purchase price in cash now. 
You also know in the real world how difficult and how long a wait it is for Sellers in similar situations.  By introducing Seller-financing to willing Sellers with properties and other assets they would like to sell, and eager Buyers who would like the opportunity for ownership, it allows you to open up the property to a much broader market immediately.
It is a Win, Win, Win situation and the property or asset moves much quicker, the Seller has their money much faster, and by bringing the Seller-financing options to the attention of the Seller you have effectively represented your client.
As the Agent you have definitely earned your commission, with creative out of the box thinking.

Lease Option / Purchase

Present Condition –  Buyers are difficult to find with today's restrictive financing rules.  Lenders are making it very difficult to purchase, they are asking borrowers to put up 20% to 30% of the purchase price.

Possible Resolution – Lease Option Agreement
A typical lease option agreement is written for two (2) to three (3) years, the buyer and seller agree on a sale price which will take place at the end of the term of the agreement.  The buyer will make an initial down payment of approximately 5% of the purchase price, and agree to a reasonable monthly payment, which includes additional payments, which are used to buy down the price of the home. 
Term of lease option is 3 years, monthly payment $1,875.00
Purchase price $158,250.00 with a down payment of $7,800.00 of which $175.00 per month will go towards the purchase price.

Benefit to Seller – Seller is selling the house, not just renting, the buyer will assume all responsibilities relating to the property (electric, water, maintenance and pay for all repairs.  The seller will receive a down payment of equivalent to or more than first, last, and security, which will not have to be returned if the buyer fails to close in the agreed amount of time.  The seller also has the option for an additional fee to extend the agreement if it is not feasible to close at the original agreed time.

Benefit to Buyer – The buyer is purchasing a home with a small (5%) down payment, in this case $7,800.00 compared to the $32,000.00 (20%) or $48,000.00 (30%) the lenders are asking for. The buyer will also have accumulated $14,100.00 the $175.00 a month = $6,300.00 + $7,800.00 down payment towards the purchase price, plus the credibility of making timely payments.

Exchanging using Removing the Blanket and Subordination

Present Condition - An exchangor has a large parcel of undeveloped land that he has had on the market for a
considerable length of time at a reasonable price, but the market has been changing and the only offers he has received
have been unacceptable to him.
A developer is very interested in purchasing the land, but he has several homes on another project that were sold
pre-construction, but buyers are having a problem closing on those homes, and he is concerned he may have to
discount those homes allowing the buyers to close. 

Possible Resolution – The developer and landowner work together to solve each of their problems. 
The developer creates a blanket mortgage for the unsold homes. 
The landowner subordinates his position in his undeveloped land to the developer. 

Resolution – As each home closes the developer will release an agreed upon amount to the landowner.

Benefits to Developer –The developer who has good credit, and along with the landowner subordinating
his land, has the ability to move forward in developing the land, with out having to drastically reduce the prices on
his homes and will not have to wait to close on his present homes.

Benefits to Landowner –Working with the developer by subordinating his land he will receive his original asking price, and have great collateral while the deal unfolds.

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The Wonderful World    of Real Estate

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