Here’s How You Can Create Your Own Mortgage!

If you had the opportunity to create a mortgage on YOUR terms, would you know what all your options are?

Few investors and homeowners even understand what the heck a Subject 2 or a Term Deal even is. And what’s the difference between a wholesale and structure deal? And how do you know which one works for you?

Have no fear investors…

I've made this awesome video to help answer those and other questions. Check it out and then keep on reading when you're done... I've got a great student story to share with you that I think will really help you get your brain around this, and leave you with some nice takeaways.

This is worth your time, trust me...

A Case Study in Why Certain Properties are Better than Others

So check this out. A student of ours sent me a question about a deal that is READY TO GO, but he needs some help with it. He wanted to know what to do next. Here’s the deal…

The owner of the property lives in South Dakota and the property is in Greensboro, North Carolina. It’s a single family residence. The owner wants nothing to do with the property anymore and likes the Subject 2 option.

To start, the property is a 3br/2ba block home. These types of homes are the kind of homes we often look for. In our experience, these types of homes are some of the easiest to market, sell and profit from effectively.

Throughout the years, I have been able to MASTER deals involving 3br/2ba block homes. Doing these types of deals is part of what has personally made me a millionaire real estate investor. These deals have helped me thrive financially in a flailing economy.

But back to our house in question…

Some other attractive things about the property are:

  • Solid tenant living there now
  • $1100 + $50 HOA = $1150 monthly rental payment
  • Home is in excellent condition: only 7 years old with no repairs needed
  • One mortgage that is current: 30-year fixed mortgage, 25 years remaining, 7.5% rate,
    PITI $1050/month
  • The current mortgage balance is $112,000; market value is $104,000

Even though this tenant is solid, I’ve never met a perfect tenant. Sometimes people accidentally flush a diaper down the toilet causing the pipes to burst and then all the plumbing must be fixed. Who has to pay for that? You got it. You do.

And even if everything else goes right, sometimes people simply have to move; it’s unavoidable. Life happens, so it’s important to be prepared for anything... maintenance, taxes and other unforeseen expenses all have an effect on your cap rate.

This deal had some challenges, but we were still able to make the repairs, pay off debt and make a nice monthly cash flow on it.

No-Nonsense Advice

Some of the best, no-nonsense advice I could give any new investor is: don’t give anyone any sales pitches. You’re an investor, not a salesperson.

Just be honest with the owner. Let them know that they are probably going to want to consider a short sale. You may want to contact them again in another 6-8 months.

Don’t just sit in the stands and watch everyone else play. Get in the game. Little by little, keep learning the tricks of the trade and keep pushing forward.

Now You Weigh In

Did you find as much value in these blog posts as our students have? If not, what would you like to see us improve upon? Leave a comment and let’s continue this conversation. And be sure to check out my helpful previous posts too.

Stay tuned for more expert examples of wealth-attracting real estate deals just like this one!

Stay blessed, friends. Here’s to your success with real estate.


Franklin A. Cruz

PS. Need a mentor?

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