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Simultaneous Closings: The hottest new real estate tool

Posted by RozzLi Reality, Inc. in Chicago-Naperville-Joliet, IL on Dec 23, 2007

Ever wanted to know what creative financing means to RozzLi Reality? Below is an example from RozzLi's Investor Forum, explaining one of many creative financing strategy.

SIMULTANEOUS CLOSINGS: THE HOTTEST NEW REAL ESTATE SALES TOOL

Simultaneous Closings are the new hot item in the real estate industry. What is a Simultaneous Closing? It is when a home seller creates a note for the buyer (seller finances) to facilitate the sale of his property, and then sells the note to an investor at the same time.

The Simultaneous Closing is nothing more than creative financing. We all know that it is much easier to sell real estate if owner or seller financing is available. However, most sellers do not want to take back financing. They do not want to play the role of a bank, but if the seller can take back financing long enough to create a note, that note can be sold to an investor, allowing
the seller to cash out of his property. Here’s how it works.

Say a seller has a property he’s been trying to sell for months at $100,000 and no buyers have surfaced. With a simultaneous closing, the seller can advertise the property as owner financing with no need to bank qualify. This will create an abundance of buyers. Working with an investor, the seller finds a buyer who is able to put $20,000 down and agrees to take back the balance of the financing, subject to being able to sell the note. With the buyer of the property identified and the conditions of the note agreed upon, the investor buys the note from the seller once the note has been created. Here's what it looks like:

$20,000

$72,000

The seller gets $20,000 down and $72,000 from the sale of the note, for a total of $92,000. Although the owner did not receive the full asking price for the property, he still sold for a good price. In fact, the seller probably would have sold his property a hundred times if he got an offer.

This is just one of many ways RozzLi Reality utilizes creative financing. If your house is sitting on the market, call our office and let RozzLi and its creative strategies help alleviate your burden.