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    Real Estate: Creative Financing
    Real Estate: Creative Financing
    Real Estate: Creative Financing
    Ebook122 pages1 hour

    Real Estate: Creative Financing

    By Bruce Kellogg

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    About this ebook

    Why buy and read Real Estate Creative Financing?

    Are you interested in owning rental real estate? But are you short of cash? Would you like to learn how to own real estate without cash? Learn the basics from this book. Learn what a note is. Learn about security instruments. Learn about purchase and sale agreements. For example, some sellers don't need cash but would prefer to offer financing to their buyers. This book teaches you how to find those sellers. Many other profitable techniques are demonstrated in this book. Buy this book if you want to succeed in real estate creative financing.

    LanguageEnglish
    PublisherPage Publishing, Inc.
    Release dateNov 13, 2024
    ISBN9798891572782
    Real Estate: Creative Financing

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      Book preview

      Real Estate - Bruce Kellogg

      Table of Contents

      Title

      Copyright

      Introduction: Beyond Cash

      Chapter 1: Notes and Security Instruments

      Chapter 2: Purchase and Sale Agreements

      Chapter 3: Seller Financing

      Chapter 4: Seller-Carryback Note Terms

      Chapter 5: Using Notes to Buy and Sell

      Chapter 6: Shared Appreciation Mortgage

      Chapter 7: Land Sale Contract

      Chapter 8: Equity Sharing

      Chapter 9: Leases and Options

      Chapter 10: Necessary Disclosures

      Chapter 11: Dealing with Negative Cash Flow

      Chapter 12: Dealing with Balloon Payments

      Chapter 13: Partnering for Profits

      Chapter 14: Buying Real Estate Using Real Property, Personal Property, and Personal Services

      Chapter 15: Finding Opportunities

      Chapter 16: Crafting Creative Offers

      Chapter 17: Conclusion

      Conclusion—The Creative Mindset

      Appendix A: Purchase and Sale Agreement

      Attachments to Purchase and Sale Agreement

      Appendix B: Addendum No. 1: Note Terms

      Note Terms

      Appendix B (continued): Addendum No. 2: Required Disclosures

      Appendix B (continued): Addendum No. 3: Broker and Attorney

      Appendix B (continued): Addendum No. 4: Owners' Association

      Appendix B (final): Addendum No. 5: Land Purchase

      Appendix C: Resource Library

      Resource Library For Leases and Options

      Appendix D: Resource Books

      About the Author

      cover.jpg

      Real Estate

      Creative Financing

      Bruce Kellogg

      Copyright © 2024 Bruce Kellogg

      All rights reserved

      First Edition

      PAGE PUBLISHING

      Conneaut Lake, PA

      First originally published by Page Publishing 2024

      ISBN 979-8-89157-263-8 (pbk)

      ISBN 979-8-89157-278-2 (digital)

      Printed in the United States of America

      The Basics

      Seller Financing

      Dealing with Financing Consequences

      Other Creative Acquisition Methods

      Applying Creative Financing

      Appendices

      Introduction

      Introduction: Beyond Cash

      Traditional financing

      Traditional home financing in the United States is a cash down payment to the origination of a new loan. Commercial properties are purchased in much the same way. The key is the employment of cash.

      The other way: Creative financing

      This book is intended to be a thorough guide to investing using alternatives to cash. It's known as creative financing, and you will learn all about it here. We will be going way beyond cash.

      Case no. 1. Suppose I owned a duplex, and an identical duplex was run down next door. I found the owner was an anesthesiologist who lived 60 miles away. He admitted that he never visited his property or maintained it. I offered him a) zero down payment; b) a 20-year loan with no interest, just principal-only payments; c) payments equal to the rents he was receiving; d) paying his closing costs for him. Win-win? You bet! He took it!

      Case no. 2. A family in our circle decided to relocate to the foothills of the Sierra Mountains. They owned two tract homes locally as rentals. I offered to buy them subject to the existing first loans and take out a second loan with them for their equity. The husband wanted a down payment of an unfinished, new rolltop desk from a local furniture store. I put the desk on a VISA credit card and paid their closing costs, and the houses were mine. No cash down payment. Seller financing. Win-win.

      Case no. 3. For a time, I was part of a group of real estate wheeler dealers, where real and personal properties were traded around. My favorite trade I saw was a mid-1930s 42-foot motor yacht with an inboard 350-cubic-inch Chevrolet engine used as a down payment on an 8-unit apartment building. The yacht was all wood, and the interior appointments were stunning. It was regal!

      The cases cited above are meant to introduce creative financing and to whet your appetite for it. It's fun! It's creative! It's lucrative! And you'll meet some real characters along the way. So let's go!

      Chapter 1

      Notes and Security Instruments

      Getting started

      Any extensive presentation of creative financing necessarily begins with notes and their security instruments. Notes are promises to pay money from one party, the payor, to another, the payee. They have been around in various forms for centuries, and their use is highly refined at this point. Let's discuss the three main types.

      The unsecured note

      This is the simplest note, shown in figure 1. It is generally used to memorialize a loan, or debt, between two parties who trust each other, or should. Since there is no security, the only way to collect the obligation in default is with a lawsuit. Once a judgment has been obtained, collecting involves finding the debtor's assets, legally attaching them, then monetizing them. This is time-consuming, expensive, and often unsuccessful. Still, they can be used in real estate creative financing, and we will

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