Solve Seller Problems Like THIS for Bigger Profits 💡

So this guy Francisco calls me yesterday. He Googled sell my house cash. I got to be done, you know, fast, whatever he searched. He found my platform, filled out a web form. It dropped into my CRM. I called him and, you know, had a conversation with him, explained to me he had to bounce job. Can't remember exactly what it was, but I think it was a job. And he's just like, bro, I just need, I need this thing gone. He's like, I'll take $290,000. That was what he told me, like in my web form. Right. He filled that out and told me right out of the, right out, right from the get-go. But it's a nice house. Like he did, he put some money in this thing. Thing, and he's already moved out. So now he's sitting on a payment that he doesn't like. He's already where he needs to be. And I look at it and I just have a very direct conversation with them. And I said, Francisco, you're, you're listed at $340,000 and it's not selling. So a cash offer of $290,000, just, it won't work. Like, that's too close to what you're listed for. Because if I go and pay $290,000, I mean, I might not end up selling this thing for— because $340,000 obviously isn't getting it done. Is it going to take $300,000? I mean, there's no spread there. I'm— yeah, then I'm really losing. I said, so like, what's your— what's a realistic number that you could do? He's like, well, he's like, I still owe $235,000. I said, okay. I said, well, yeah, so instead of taking a huge haircut, have you ever considered selling your home on terms? He's like, well, what, what's, what's that? What's terms? I said, well, basically you sell it to me for a, a price. Let's say I, I'll pay you full price. I'll pay you $340,000. I'm going to give you a little bit of a down payment. And then the remaining balance, I'm going to pay you out over time. That way you don't take a huge haircut right now by selling it cash, you're going to make a lot more. And we figure out what works for everybody, works for you, works for me on that timeframe that I pay you out over time. Right. Your mortgage is going to stay in place. His mortgage is $235,000 at 3%. I said, that's going to stay in place. And so the difference between $340,000 and $235,000 is $105,000. I said, I'm going to give you $20,000 down, so you're going to carry a second for $85,000. We'll work out a payment that, that works for me and works for you. I'll pay it, and then I always try and do a 10-year term. So always, right?

You don't want to go too short.

I said, I'll make payments on this for 10— for 10 years, and then at year 10, I have to pay you off the entire balance. He's like, dude, I'm, I'm down with that. Like, that works. It gives me some cash, and I sell it for the higher price. And he's like, I'm totally down with that. He said, but— and I'm like, oh boy, what?

What's the but?

He's like, my insurance went way up. And so my payment on this thing is $2,000 a month. Oh, what? What? And I said, is it cash flow? $235,000 mortgage at 3%. You should not be $2,000 payment.

Yeah, you got to get a new insurance company.

It's the homeowner's insurance. The homeowner's insurance. He apparently had a lapse in homeowner's insurance, which I don't know how he did because the lender's the one that makes sure you have it. So he had a lapse in homeowner's insurance and the lender put on what's called a— it's a force policy and it's a very— I mean, it's double, it's more than double what it would be on a normal policy. So I dug around a little bit and found out that you can get rid of those. You can go find normal homeowner's insurance and get rid of that. He just hasn't done it. He's been too just caught up with life and problems. And so he just hasn't done it.

So you're telling me you're solving a problem here? This sounds like a problem you found and you're solving it.

Exactly. So he has $2,000 a month. If you get normal homeowner's insurance on it, it'll be $1,700.

Okay. And what is, what is Zillow saying that the potential rent estimate is in that area? Just because I'm assuming you would rent it or sell it on a wrap, right?

So what I always have, I always have Zillow, I always have Zillow pulled up and when I click on it, still would definitely hold this and rent it.

Okay, you'll rent it. Okay.

Or you wholesale it because you can wholesale sub-2 deals. Of course.

Yeah. On a wrap.

Right. And you can go and wholesale it to somebody with more— basically you're selling it for more than what your down payment is, your total entry fee, and you throw a wholesale fee on there and it still— it can still make good sense for an investor, I think. Oh, okay. Yeah, so I had comps at $2,500 a month and $3,000 a month because this house is big. It's 3,100 square feet. It's got a full basement in it.

That's a big house.

Yeah, even at $2,000 a month, even at $2,000 a month, the deal works. But it even makes it better when you get normal homeowner's insurance on it and you're able to only have it $1,700 a month. So in my $600 a month in rent, and all in on his payment, you're $2,000. That's PITI, right? Principal, interest, taxes, and so insurance. Yep.

Lane, can I do something super quick? I want to share the screen with people just so they know that this is why it wouldn't work for a wholesale deal. So just so everyone understands the numbers behind wholesale, you know, cash offers. Lane, you said that he's trying to sell for $340,000 on the MLS. Yeah, and it's not moving at $340K. So that means it's not going to sell at $340K. So let's actually just say it's worth like $320K potentially, right? And at $290K, if we were to get it for what he was kind of wanting at $290K after paying, you know, if you're going to flip it, if you paid insurance, interest, got hard money, it took maybe 2 or 3 months. You put— maybe you just clean up a little bit, fix a bathroom or so. You don't put too much money into it. You want to make $5K. You put $5K into it and you want to make a $10K wholesale fee. You look at the numbers. The numbers, and if you bought a house at $290,000 trying to resell it for like $320,000, $330,000, you're losing money. So really, like, when a cash offer— for it to make sense, you have to get it at quite a discount. That's why you're looking for people who, you know, are motivated. The house needs to be, you know, has quite a bit of distress, like you need to fix it up. So anyway, Lane, I just want to show everybody that, like, for cash offers, got to be considerably a lot lower. But in this situation, because it is livable, you can definitely do a sub-2 deal. And the interest rate's low.

Exactly. So I want to get Francisco on the phone right now.

Let's call him, brother.

So I have not presented him a deal yet. I've talked to him about the problems of his high payment. It makes it a little bit more difficult on the sub-2, but I'm going to call and just kind of walk through this scenario with him and then see where we end up. I mean, I'm going to end up making him an offer right now. If we can agree on it, I'll get the paperwork over to him today.

I love it. You're going to call him right now.

Francisco, hey, it's Lane again. How are you doing? How are you? Good. Hey, did I catch you at a good time? Okay, yeah, I just— I'm just hearing a lot of background noise. I can't hear you very well.

Okay, uh, in that case, I guess I'll call you back because I am at a graduation.

Okay, well, I actually— I can hear— I can hear you pretty good now. Is it okay if we have a conversation real quick?

Yeah, we can have a talk. Okay, as long as you can hear me, I can hear you.

I can, I can. Hey Francisco, um, all right, so you know, I'm, I'm looking at your house and comping it out, and because you're listed at $340,000, I just think that, you know, my cash offer is going to be well below what your payoff is because your payoff is at $235,000. And you know, I, I don't know what it's going to take to get your home sold because obviously $340,000 is not, not doing the trick. And so I don't know if that's going to end up having to be $320,000 or even $300,000. And so I think that, uh, I mean, anybody that is going to give on a cash offer— I mean, honestly, I don't even think it's worth talking about because I don't— I mean, I don't want to— I don't want to offend you, and it's going to be— it's going to be well below your, your payoff. But yeah, it would be, it would be around like $205,000.

Yeah.

So obviously, no, no, remember we talked about selling it on terms?

Yeah.

So this is what I can do, even though your, your payment's a little high for what it should be because of the insurance. So if we, if we have to leave that insurance in place, what I can do is I can give you a much higher purchase price. I can come in with a little bit of a down payment, right? And then I'm gonna, I'm gonna be responsible for making the payments on your loan, so that'll, that'll come off your plate. And then the purchase price that I could do is basically, you know, I can do what you have it listed for. And so then that difference between your— the difference between your mortgage and the $340,000, we would just have to put a term, term on that. And the term that we would want is about 10 years.

Okay, and, uh, how much— do you have the numbers up already, or are we just talking numbers right now?

No, what I can do— what I can do is I can come in with $20,000 down, so at closing you get $20,000, right? And so that would leave a balance of $105,000 that I would owe you, and we would put a 10-year term on that. Every month I make the payments to your, you know, to your bank and to your mortgage company. And then I would also pay you an additional payment each month for the next 10 years. And then at year 10, the balance is due in full.

Okay. And then I'm fine with that. Just with the title and all that, it'll be under my name or whatever.

So the mortgage stays in your name. There's two different things when you sell a house, right? There's a deed of trust and there's also a title. So you're going to sell your home and I'm going to take title to it subject to your loan staying in place. So the deed is going to stay in place and that deed is going to remain in your name.

Okay, because I was just thinking like if something happens on your end, I still— I'm still responsible for that, right?

100%. And our paperwork is ironclad to protect you and to protect us. Every time, every time we buy a home subject to It is serviced with a professional servicing company, and we have an accelerated deed that we both sign. So if I ever go late or something happens, that home can immediately revert back to you and you get the home back without having to go through the foreclosure process, without having to do anything like that.

Okay. Okay. Yeah. I like that. Um, if anything happens, then we can talk further.

100%. What I want to— what I want to do, Francisco, what I want to do is I want to verify I have your email correct, which is Francisco. So what I'll do is I'll just— I'll email you the paperwork, you can take a look at it, we can jump on another phone call if you need to, we can go through any questions that you have, and then we can move forward and get this thing off your plate.

Okay, that's perfect. That works. If you need me to, I can also send you my, uh, my email just to make sure everything is, uh, written out correctly.

Yeah, if you want to text it to me right now just to double verify that I have it right. That'd be great.

Okay, that works.

All right, you'll have— you'll have this contract within the next hour.

Appreciate it.

Hey, thank you, Francisco. Enjoy that graduation. Bye-bye. Bam! First call, baby!

Let's go!

Did we just— did we just get a deal?

I think we just got a deal, baby! Everybody live, let's go!

Dude, I think we just got a deal. I think we just got a deal. And then we just—

my man, my man is down. My man is down for that.

So here is what my plan is with this property, just so everybody knows. If it is not in my backyard market, which is Phoenix, Arizona, I'm wholesaling everything. So I've already run my numbers and I know what the market is for investors buying sub-2 deals. And so me coming in with a $20,000 down payment, that's less than 10% of ARV. I know I can go sell that for close to 20% of ARV. Because if you look at it, an investor that is going to buy it, you know, the cash flow is there, they have a 3% interest rate, which you can— I may never see that interest rate come back in my life. I don't know, we'll see. I mean, that is an asset. And so for them to get that with less than 20% down on a property, investors love it. So I think, in my opinion, I think that I'm going to be able to wholesale that thing for close to $50,000, $60,000 entry fee.

That means you make $40,000 because you're giving him $20,000.

Correct. If I get, if I get $60,000, I might go a little bit lower just to make it more enticing and a better deal for one of my investors.

By the way, everyone, the way this works is if Lane gives the— what's this guy's name?

Francisco.

So if you give Francisco $320,000 purchase price with $20,000 down and you want to wholesale to someone, you would have to increase the purchase price by your wholesale fee, the down that you're going to add on top of his down. So for example, if you're giving them $20K down at $320K, you want to make $20K, you would sell it to an investor for $340K because you're adding $20K to the purchase price and you would increase the down by $20K. That's how we get paid when we wholesale subject-to deals is by increasing the purchase price and increasing the down. All right. For everybody that doesn't know how to do that, that's it from me, Lane.

Thank you so much. I appreciate it. Let's do it again next week. I'll have, I'll have leads piled up.

All right, everybody. We'll see you next week. And obviously, you know where to find us if you want to chat before then.

All right.

See you guys. Hey everybody, what's up? It's Nathan Payne. And for the first time ever, we just released this insane training bundle that has literally everything that I've learned from doing a combined 4,000 deals in real estate, all from starting with absolutely no previous business background experience or any real estate experience. Plus, there is over $19,000 worth of free gifts that we're throwing in, all for an insanely low, low price. If you want to get your hands on this, be sure to click the first link on the description below right now.