Vendor Finance

[Rystar]

morning all

my wife and i have owned our IP for about 4 years now, we built it actually, and it was finished around 4 years ago. we have a tenant currently on a 1 year contract and has told our agent she has just been made full time at her job and will break the contract soon as she wants to buy a house.

we have seen this as an opportunity to sell her our IP on vendor finance, to turn this into a cash flow positive property. i have just heard from the agent, and the tenant is interested in buying.

now i need to get myself into gear..... as we were only lightly talking about doing this when her lease is up... in another 9 months.

can you all please give me some help here???
where do i start?
do i need to get a wrap kit?

thanks heaps
Ryan

 

[Xenia]

Hi Ryan,

First of all have you established that she will buy on vendor finance terms? If she has a full time job she may be able to purchase outright!

What is it that you want to do?
Wrap around mortgage?
Lease with option to purchase?
Carry back a second mortgage by providing the deposit (making it easy for the purchaser to buy with no money down)?

These techniques are all very different with different paperwork invlolved and fall under differnt parts of the law. People usually call all these "vendor finance" which is not the correct term!

Just trying to establish what you are trying to achieve!!!

 

[Medine]

Hi Rystar,

I agree with Xenia's comments about checking if the tenant wants vendor finance.

If she does, Rick Otton, who was doing the seminar circuit recently does a wrap manual. His company is We Buy Houses.

Cheers, Medine

 

[michaelg]

Hi,

If you're based in Sydney call Cordato Partners and asked to meet with Tony Cordato - he is a Sydney lawyer familiar with vendor finance.

Regards
Michael G