Real Estate Note
Hey did you hear that old Bud Theweiser is retiring, and wants to sell his pub for a $ 135,000; including real estate valued at $70,000? Bud wants $50,000 dollars down in cash to pay off closing costs and pay off some personal debts, and $15,000 to put into a money market fund, for retirement income and emergencies. Bud is willing to carry the remaining $85,000, payable at $913.41 per month over 15 years, at 10% interest. He is counting on this income to supplement his retirement over the coming years.
I heard that Roger Mantis wants to purchase the pub, but he only has $12,000 cash. But Roger does however holds a $16,000 business note paying him $298.82 per month, with 72 payments still due. And Roger also owns a building free and clear that is worth $40,000, that he wants to keep as an investment. So Roger's attorney Elmer Lawson, contacted Fastcashfunding.com , to look into ways to resolve Roger's cash shortage problem.
Fastcashfunding.com suggested that Roger offer $65,000 for the pub, with $28,000 down, in the form of $12,000 cash, and the $16,000 dollar business note. The remaining balance of $37,000 dollars would be carried back on a 15 year real estate note at 10% interest. Roger would also give Bud $70,000 for the tavern real estate in the form of two separate real estate notes. The first real estate note was to be in the amount of $40,000 dollars, that is to be amortized over 30 years at 9 % interest. The payments would increase by $200 at the 140th month, and increase another $400 per month, beginning at the 181st payment. The second real estate note would be for $30,000 and would have a term of 360 months at 9% interest rate, with the payment increasing by $300 per month, beginning with the 73rd payment. This real estate note would be payed off in 139 months.
In order to create equity protection, Roger would pledge his free and clear building as additional collateral for the $40,000 dollar real estate note. Bud on the other hand, will sell the first 137 payments of this note to Fastcashfunding.com who will pay $23,000 dollars for them. Although Bud only gets $35,000 total in cash on the front end of this deal, he still retains an additional $15,000 in liquid equity, earning a weighted average coupon of 9.3%, rather the 4% paid by the money market fund.
By using this approach, Bud receives an average $938 monthly payment for 137 months, two payments of $1,260, and 41 months of $919. At 180 months, Bud will have received $168,755 in total monthly payments. Better yet, he has a balance of $22,173 remaining on the first real estate note. If he wants to cash out, he could sell his real estate note for around $20,000.
I heard that Roger Mantis wants to purchase the pub, but he only has $12,000 cash. But Roger does however holds a $16,000 business note paying him $298.82 per month, with 72 payments still due. And Roger also owns a building free and clear that is worth $40,000, that he wants to keep as an investment. So Roger's attorney Elmer Lawson, contacted Fastcashfunding.com , to look into ways to resolve Roger's cash shortage problem.
Fastcashfunding.com suggested that Roger offer $65,000 for the pub, with $28,000 down, in the form of $12,000 cash, and the $16,000 dollar business note. The remaining balance of $37,000 dollars would be carried back on a 15 year real estate note at 10% interest. Roger would also give Bud $70,000 for the tavern real estate in the form of two separate real estate notes. The first real estate note was to be in the amount of $40,000 dollars, that is to be amortized over 30 years at 9 % interest. The payments would increase by $200 at the 140th month, and increase another $400 per month, beginning at the 181st payment. The second real estate note would be for $30,000 and would have a term of 360 months at 9% interest rate, with the payment increasing by $300 per month, beginning with the 73rd payment. This real estate note would be payed off in 139 months.
In order to create equity protection, Roger would pledge his free and clear building as additional collateral for the $40,000 dollar real estate note. Bud on the other hand, will sell the first 137 payments of this note to Fastcashfunding.com who will pay $23,000 dollars for them. Although Bud only gets $35,000 total in cash on the front end of this deal, he still retains an additional $15,000 in liquid equity, earning a weighted average coupon of 9.3%, rather the 4% paid by the money market fund.
By using this approach, Bud receives an average $938 monthly payment for 137 months, two payments of $1,260, and 41 months of $919. At 180 months, Bud will have received $168,755 in total monthly payments. Better yet, he has a balance of $22,173 remaining on the first real estate note. If he wants to cash out, he could sell his real estate note for around $20,000.
posted by Robert Pomerleau | 3:08 PM
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