They all nodded in agreement. “Let’s assume that the seller agreed to accept our offer of $39,500ten percent below market—with only $500 down. How would we pay him his equity?”
“In monthly payments?” “Right. We’d assume his loan of $21,000 and on the balance— $18,000 after our $500 down payment—we’d negotiate to pay the seller so much a month. Let’s say the bank payments are $200 a month, and the seller will take $200 a month for his equity. Our total monthly payments would be $400.”
“But,” Steve said, “I don’t have four hundred a month to spare.” Philip raised his hand. “And where would I get the five hundred down to buy the property in the first place?”
“You tell me,” I shot back, wanting to make him think for himself. “First I tie the property up with a postdated check for five hundred dollars and a closing in thirty days. Tell me when I’m wrong now.”
Taken From:The ROAD TO WEALTH