Tommy Dobczyk breaks down a $600,000 seller-financed deal where the seller nets $240,000 at closing and receives $456,000 over five years for a 16% cash-on-cash return. The buyer pays a 60% interest rate with a $500,000 balloon payment due after five years.
That's why it's coming due in August right now. So here's the economics of it. Sale price, $600,000. Buyer down payment, $60,000. Seller finance, $1,540,000. They're paying off the $30,000 loan, which is then giving them a net cash at closing of $240,000. So interest rate at 60%, amortization rate at 30%, that'd be going down. So here's where we're at. So the monthly payment to the seller is going to be about $3,200. And then after the 5 years, they'll have a total of $194,000 with a 5-year balloon of $500,000, like that's their balloon back, right? So, cause we're going to get some amortization on it. So net seller receipts after 5 years is only $456,000. So what that does is it gives them a cash on cash on net cash tied up of 16%. Okay. So the 6% is their true note yield, then they'll have a 16%.
Mind-Blowing Phone Farms Explained: Unlock Social Media Growth Secrets! #shorts
Planning Secret Investor Retreats with Prism Jets: The Ultimate Networking Hack! #shorts
