Rent The House Don't Sell It
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- Опубликовано: 6 окт 2024
- I Told My Friend To Not Sell His House & Instead Rent It Out Because Of His 2.8% Interest Rate.
#shorts #rental #realestate #wealth #wealthbuilding
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This is all based on the hope that all bills get paid and the folks on both ends are honest.
They use contracts for that.
Exactly. In perfect world
Had that mindset they would not get mortgage sales
@@elvinmunoz8937That doesn’t mean it won’t take 3-6 months to evict him or her and hope they dont trash the place
@@brianasbell5856 That's why you have to do your homework on where you buy the rental property and do proper vetting to see if the person renting is a proper fit.
this man is one big walking red flag
How is that ?
@@tsaunders4684 Take a course how to detect a scammer. One of his video’s someone invests 20 million but when he checked the books Grant didn’t want his 20 million anymore, his clients must trust him on his words. Biggest red flag you can get.
@@tsaunders4684Because he makes his money off of selling his teaching programs to people...
And?
You buy things from companies that are bigger red flags. What's your point?
@@tsaunders4684 lol these morons just repeating hate they hear yet they can't stop watching 😂. Ignore the haters.
Because everyone can carry a $4.8 million loan while qualifying for another loan.
Anybody with a 4.8 million loan it’s not exactly broke 😂 that’s most likely only 35 of net income.
Exactly. And no one is going to rent at a 6% finance.lol. this guy is a joke. Even now a days with my salary and credit score, I got a house at 2.5%. And I still couldn't afford two houses at that price.
@@JasonSmith-v6xhe’s saying seller finance the property at a 6% interest rate. That will cash flow over the current mortgage with a 3.2% rate. My friend buys property cash and seller finances then to people who have bad credit and can’t get loans. He locked some guy in at 8% for a full 30
@@JasonSmith-v6xDSCR loan requires no income. 6-12 month of reserves.
I'm not agreeing with Grant, but if you take a rental agreement or mortgage note you hold to the bank, that isn't counted against you in your debt to income. - Realtor
He makes it sound so simple, when you have people squatting in homes and giving owners HELL.
He's explaining the concept, not saying it's easy. You think he hasn't dealt with problems like that?
Yes, the reality always harsh. Not as easy as he speak
Not when you offer owner finance. Renting is something else but with owner finance he can charge a higher rate than his current interest and take the house back if he misses a payment
@@gsgcarreviewsalso... the buyer is paying a large downpayment. That means the buyer has skin in the game.
We just need to give them 2A
If your Buddy has a 4 million $ property.
He doesn't need your advice.
A Billionaire giving millionaire's advice on how to do better. You'd be a moron not to take the advice.
He's not a billionaire...@@TedCampbell204
@@TedCampbell204but guy makes no sense. Why would someone pay 6% interest to someone. Because any who can afford 3.2 million dollar house are not broke.
The bank owns him bro he owes the bank 4 million hes poor
Tell that to Mike Tyson, Floyd Mayweather, Michael Jackson.. 😂😂
Bought my 1st home this way.At the time couldn't get a bank loan due to no credit
And being young.The owner was a kind old man who have me a chance and carried the loan.I paid the loan off in a 8 years.I will always thank the old guy for giving me chance.
All fun and games until the original bank calls the note due…
huh? its a mortgage. its a 30 year loan. the original bank will never call the note due
@@jeepguitargod he’s owner financing his home without paying the original lender I. Full
Lol 😂 unfortunately it's not sold till it's paid in full so it's a rent to purchase and Bank can't call in loan unless he gives title
@@boogierhea6515 it’s called a wrap around mortgage. Do a little more research before commenting. He’s arbitraging the difference from the bank loan int rate and the new Owner finance rate. Deed transfers without original bank knowing. Once they find out, loan can get called due.
no , he means pay off the banks, then sellers finance at 6%. legal
@@User_91hsj
That’s called a wrap around loan. If the bank gets knowledge without their approval they can call the loan due. The new owner also has to have faith that you will pay original loan.
Good point.
Most likely won't
Banks don't care where the money comes from....the bank still first in line. Bank don't wanna know what's going on😂😂😂😂
@@kimberlymartin459not in this case because of the interest rates. They can call due a 2.75% loan and lend that money out at a much higher interest rate.
Yeah, that's why rentals exist..
He said if a guy misses one payment put it back on the market. Heartless
😂😂😂😂😂
Yes if the guy stops you foreclosure and take that shit back. And keep all the money
it’s a 4 million dollar house. stop shedding tears for the rich
@@universalsorrowthat doesn’t mean there rich, if you haven’t noticed what he pretty much said was rent to own rich people don’t do that
A lot of mortgages contain a "due on sale clause," meaning when the bank finds out you are doing this, they call the note due within 30 days... food for thought.
You can get insurance on that
Yes that is true but most banks don't execute that as long as everything is paid up to date. Even if they do go that route all you have to do is call and show them how you are going to pay and what your plan is and then they in most cases let you continue. They just want to be sure that they are going to get their money back and as along as that happens you are good.
After two years, you can rent out your primary residence. And as long as you have landlord insurance, you’re good
It's a least to own, in a land trust.
If the mortgage can get paid, why would they want to call it due? Banks are in business of making money on their money, not managing real estate, it behooves them to just keep collecting payments, and calling it due rarely happens especially if it's BOA wells Fargo and the like...
“Just rent it out, it’s almost like a rental!”
😂😂😂
Came here looking for this -
Thank you. This comment section is full of retareds
😂😂😂😂😂😂
He meant to say just sell it subject to the existing mortgage in place I'm sure lol
It won't work in Canada. You have to renegotiate an interest rate on your mortgage every 3-5 years (no longer).
What seriously? You aren’t locked in for the 30 years?
@@jakejimstone5029 how(and why) could you agree to a loan when your liability isn't locked in?????
Love that Grant took what Pace shared and incorporated within his strategy to win.
When he said 2.8%, I knew right away that guy is using a VA loan. Thank you for your service, Sir! You deserve it!
Not necessarily. In 2020 anyone could refinance at a rate as low as 2.375%.
It’s called a subject to. The buyer is buying the house subject to the sellers existing mortgage
It’s not sub-to b/c he’s selling it to him at a higher interest rate.
He’s selling it on a wrap.
Its seller financing
Subject to
Seller finance
Contract for deed etc
Cardone used wrong vocabulary when he said rent it to them @ 6%
I have bought property sub to. This is not sub to.
Owner finance
Sounds good on paper. Unfortunately everyone is looking out for their own best interest and something will go sideways when it comes down to it. The only thing that might make this work would be the down payment, as the owner you should take that and view it as 1 year + worth of payments on the property. It’s not yours, it’s your cushion for WHEN something goes wrong
Only problem is you can’t owner finance a property you don’t own.
Thats where you're wrong.
Yes you can. It's called seller financing. You create a note between yourself and the buyer, no bank involved.
Or, if you don't want to give up the deed right away and keep ownership til they pay you off you can do a land contract also called contract for deed, and then do seller financing.
Plenty of ways to buy and sell real estate my friend.
Did that once. Mortgage company not happy. Just😅about lost house.
@@maryhybki3631don’t speak to direct, these morons will get upset 😂😂
Anything goes in this wonderful economy
My poor dad played the lottery to get rich. My rich dad said winning the lottery won’t make you rich unless you change your poor man habits.
Rent to own a property that the bank owns “ technically “… bad idea…. If the bank finds out your doing this…. They’ll request the full balance to be paid or foreclose on you in Illinois
Rarely. As long as the payments are being made they generally don’t care. Especially not in this climate.
Who would tell the bank?
Bank would care more about the mortgage being paid monthly than taking the house or foreclosure.
Bro stfu this is why people stay poor because of that chicken shit mentality. You know how much crap the bank gets away with? Do you not remember 2008 and guess who got bailed out? Yeah, not us.
@@arieanna828 that’s what mommy bank said when I brought up the idea.
I think he is saying the current owner becomes the bank to the new owner. If the new owner can't pay, then he goes through foreclosure. Then the house comes back to the original owner and he can do it all over again. Not sure but I think that is what he is talking about.
Bases everything on best case scenarios.
Lol or fantasy. People who can spend 10k-20k a month on their house dont rent a house and throw their money away. They buy a house and pay their own mortgage. It's almost impossible to rent a 4 million dollar home. Ud be lucky to find an athlete who got traded and only needs a place for 15 months until his contract is over
He’s a clown
@@davidmarvy6788he’s not saying to rent it out. He’s saying to seller finance the property. Rich people seller finance to each other all the time. Why let the banks make money off of them when they can make money of each other
Sooooo very smart. We look for loan assumptions, and or renters to buy the currents debt. Make money a few diff ways. Great advice 💯
Assuming that does not violate your mortgage terms.
If the buyer were to 'assume' the existing loan, then likely. But to sell a home based on seller financing is very common.
The reason it might be new to some, is that interest rates have declined for many years. As interest rate go up, this approach to buying and selling will become much more common.
@@timwinard7222 You can't owner finance a house that is mortgaged. The bank must be paid in full first. Period, end of story. No need for two paragraphs.
Sounds like he took the game that pace morby dropped on him and giving that out 🔥💯
Not a tax expert or anything…but sounds like an audit waiting to happen
Why? What is being proposed is a sale using seller financing. Nothing unusual.
😂😂 mofo went from real estate to taxes and tried to sound smart in the process
Zero issues doing this from tax perspective. You simply claim the interest income that you make, over above the interest payment that you paid, and that becomes taxable income.
Why does everyone go to taxes when they have no clue what they’re talking about?
Who is renting this unit at these numbers that are not owners themselves. Great ad Cardonel
Renting your house is not as easy as they make it sound.
Also, if someone can afford a 4 million dollar house why would they bother renting.
@@noahroland5586LOTS of reasons to rent instead of buy. It just depends on your situation. If you're growing your wealth, renting is actually a better play than buying. You get control of the property without the liability associated with owning. If the water heater breaks, the HVAC goes out, or the roof leaks, it's not your responsibility to fix it (unless you were stupid and signed a crappy lease to begin with).
So a guy who can pay a $ 4 million / 6 % loan 💵 why wouldn’t he be able to have the same loan as a mortgage with 2,8 % interest! Sounds good in paper but where is this guy paying 6 % 🤷🏻♂️?
Because the 2.8% interest rate no longer exists. Interest rates went up
Where I live there are special clauses in property agreements that prevent this kind of thing. For example u can't rent and property and then rent it out to someone else as a third party because it's not ur property.
And then selling someone your property and charging them interest is a form of providing credit. U have to be a financially registered credit provider to do this kind of thing. Maybe it works in the US but it's not possible here
And hopefully the renters dont destroy or beat the crap out of your house.
Right
They are "rent" to own. They have ownership incentive. If they make payments for 20 or 30 years (depending on the contract) they own it
And have you NEVER heard of insurance?
Thanks for that idea guy. We need guys like you to get this economy roleing again. Increase the money velocity, let the good times roll and thrill your soul
He makes it sound like foreclosure is a simple thing without effort. He seems to try and oversimplyfy everything he talks about. Be cautious people.
I only heard this short clip, but why are you assuming a foreclosure is here occuring?
@@timwinard7222 it’s strictly forbidden in mortgage contracts. Aside from the fact buyers in that price range don’t pay high interest rates especially on 4 million dollar homes. This guy is just talking
That isnt foreclosure that is eviction. But either way he makes it sound easy. Unless we're talking seller financing which is honestly closer to what he says "give him 6% and keep the 3.2%" but that has a lot of problems too
@GK-gc9cv If you sell real estate to someone and hold the paper ( mortgage), it is foreclosure if you try to take possession of the property back from that party. States vary, but real estate laws are fairly similar in each state. If it's a binding sale contract by definition, it is foreclosure. Maybe I missed something in this guy's explanation. If so, I stand corrected.
@@timwinard7222 Ya, I watched over again and see that it is a tenant situation.
Never put a large down payment on anything like this as you are only renting not buying, as the owner can't sell something they don't own the bank's still owns the house, remember folks if it's not on paper and registered at the deeds office it is not legit
Disagree.. iv ownd 4 homes...
Like anything else, the more u pay down, the less u owe. I put 30k down on this house to avoid the mortgage insurance.. nowadays when u close on a house they want u to pay mortgage insurance, well this is just another racket.. but if u put 1/3 down u can avoid having to have the mtg. Insurance (pmi) on ur loan, wich is anywhere from 60 to 120 bucks extra per month.. so in almost 5 years at current address with current loan, iv saved almost 6k and only put down 30k to save mtg. Insurance. But every body sees things different, that's my perspective and plight flipping home since 09, this is my 4th.
All that being said, this is something i learnd from my previous home where I did pay the darn p.m.i.. so when I rolled it for about 60, the first question I asked finance lady is how much do I have to put down on this house to not have to pay the mtg. Insurance.. with each purchase in life it seems there's someone to meet or something to learn.. I'm no expert, I just learned that on previous house.. God bless
It's called a Land Contract!
It’s called a subject to deal.
It’s called you’re both right
I’ll have to admit, this is by far the most realistic thing this man has ever said. With that being said, finding a person to be that trustworthy and honest is about the equivalent of winning the lottery. Is it feasible? Yes, but 99.99% unlikely to happen.
Love how everyone suddenly is an expert in the comments
No more am expert than cardone. Slick snake oil salesman
Newsflash: Line 203 and 503. Check your home's Hud sheet/form. Your answers are there.
What do you do when they don't pay? Won't move? Can't evict them for years?
Perfect!!!!!!
don't sell it, Instead rip off the poor
@Juanpetter: you think a home that cost $4,000,000 and the word “poor” belong in the same sentence? 😂
If you're poor, you can't afford a 4 million dollar house. How are you ripping off the poor? Mortgage rates are in the 8% range. It's a good deal.
You're insane.
All fine and good until the buyer figures out he can sit in your property payment free for at least a year. There’s what works in theory, and then there’s real life.
And it's for reasons like these that the real estate markets been falsely inflated. People should not be able to monopolize houses. One house one family
The upkeep on a $4,000,000 property is going to cost the "landlord" more than that 3%
in the UK you cannot re-let a property you have a mortgage on, banks won't accept it. You need to take a Buy to let mortgage out which will be closer to 6 %.
Nice, but that’s a secondary Let and you’d need to re-mortgage on commercial terms. Which means you’d pay 6% and have to charge him 8-10 to insure the default risk. While the whole time you’re in the hole for $4m of debt, meaning you couldn’t buy another house because of your other liability!
Next guy finances at 6%...never makes a payment...takes you 2 years to get him out and end up paying him $10k to leave.
You make him put down a large down payment, this protects you. If they are buying a home for 4 million, make them put down 350k as a down payment.
It's called a land contract, my dad sold the cottage to a guy for $80,000 down, the guy went broke and dad got the cottage back
"You just take it back" Apparently Mr Cardone has never had to evict or foreclose on someone. It's done every day but it's such a pain in the azz.
The problem with this for young people is that when all the older people will only rent out properties then the younger people won’t have any properties to buy
1) Don’t sell it, rent it 2) Self finance sell it 3) Looks like a tenant 4) Only pay taxes on the stuff you have to pay taxes on 5) If they default REPEAT. Lol. What a crock of crap this guy is selling.
My grandparents and parents used these same tactics in real estate. They all owned Apartments and homes they would lease/rent. Then go build a bigger better bike for themselves!
What are the tax implications when he rents the house, moves to another house as his primary residence, and his rental property then becomes a business investment? He has to hold on to that house as a rental to avoid taxes, can deduct expenses for the rental, but the moment he sells it, the IRS is going to eat him up.
Don't put it on the market to meet the desperate demand for housing which is driving price of the market to astronomical levels. Withhold it from a whole generation of young people trying to start families. Instead of that family being able to buy a house for themselves that they could pass on to their child you can make them buy you a second one. The American dream
and that's exactly why I told all my friends never move into a " rent-to-own property" it's a complete ripoff and a scam.
Seller financing is not rent to own.
@@duran1590 =b******* it's the same f****** thing....... The same risks...
Owner financing, it's a great deal for both parties. You buy it at 6%, the banks are charging 8%.
People like this are the reason houses are so expensive.... Banning residential renting would make it affordable to buy houses again, so scummy
It is crucial to ensure that he includes a quit claim clause in his agreement. This particular provision will greatly expedite the process of transferring the title in the event that the new owner fails to meet their obligations.
Until they destroy your house, don't pay the utilities and it costs $50,000 to put it back together.
NOBODY that has a 4 mill House is financing. When you're in that neighborhood, you're paying cash for the house and not paying anyone interest. That's 13k/mo.
That’s not renting… that’s a WRAP with a Subject To. Great idea though.. that low rate is the true thing of value.
I would love to see Robert Kiyosaki and Grant Cardone in an interview and see if they agree on money related topics
Rent it out and when you get it back it’ll cost you millions to do do the repairs, genius
Big statement but most people don’t pay $18,000 to $20,000 a month mortgage, taxes, insurance. Beach front homes where I live don’t. They cost more than 4 million.
I get this idea. But sell it not rent it. You absolutely can do owner financed for a lower percentage and become the bank, and always have a hold on the asset. If the purchaser fails the property, it gets sold again with the same idea. Why need a bank to finance, especially if i can beat the rate off the bat. Its all secure through legal contracts as well, like a regular home purchase.. is kinda like a rental prop but no landlord hassle. They get their own insurance and such like a home owner. Good luck people.
Like a rental, if they cant pay for 90 days... you still own it and the profit you made. Then sell it it again, (of course is a process). I personally dont like dealing with rentals and tenants. I like when they feel ownership. They tend to take care of their investment like most people that plan to own it😅
renting 4million house is very easy - que lined up immediately
A couple pretty critical things you need to address 1.) Rental income is taxable 2.) Mortgage interest deduction is capped at $21k (2.8% on 750k mortgage cap). 3.) Repairs are your expense 4.) ...and probably the biggest one of all, you're holding on to a DEPRECIATING asset right now. Other than that, yeah.....great idea 😂
This is smart. It’s a wraparound mortgage. Helps your typical “penalty box buyer” like entrepreneurs who have a lot of cash but not in their W2. Normal play y’all just overthinking it cuz it’s grant
Remember guys: sell your humanity to the greed game. Make sure you lose empathy. It shouldn't be "aw how's this guy doing?", it should be "aw, how can I make money off of this poor guy?"
I have zero interest in being a landlord, but honestly the former sounds less of a hassle to me than getting rolled up in seller financing, as an individual anyways.
Total BS... when you rent a house you're not charging interest. This dude is a real piece of work
He means seller financing bro.
@@duran1590 he says to RENT IT OUT. You don't seller finance when you rent it out. Dumass
@@27dtrost yes but he obviously misspoke. You can’t charge interest when renting it out. He mentions “note” many teams which means he’s talking about seller finance which would consist of a “promissory note” secured by a lien on the property just like a mortgage.
Except you can't do this. Good luck at settlement when the title company finds Theres already a loan on the property.
Meanwhile a basic S&P 500 etf made 30% interest last year - but go ahead with 3% interest locked up for 15 years
Problem with this is that the seller is now only making a 2.8% net return on the cash he otherwise can invest at a higher return elsewhere, plus paying capital gains on the sale.
If you ever see a dude wearing a Richard Mille speaking into a podcast mic, there’s a 100% chance they’re a scammer
Seller financing is what he’s saying and it’s not a bad idea. It’s actually wise of you currently have a 2.8% fixed mortgage.
Perfect time to do wrap mortgages. People do these and subject-to's regularly now.
How do you finance it when the bank still owns it? If there were no liens on the property and you own it outright, sure - you can seller finance. If you don't own it, it's nothing more than a rental. Now, how do you find a good tenant for a $4 million house?
His buddy called him, hoping he would buy his house. He told him to rent it out instead.
That is a crime, you can not give random people Personal loans. You are not licensed, you cannot become a loan shark
"I said, don't sell it, dude, rent it!"
"It's almost like a rental."
If the average monthly payment is @ 0.1%. Of the loan. Then, a monthly mortgage payment on a $4,000,000 mortgage would be $40,000. Again....PER MONTH!!!!!
He should tell us where this renter is?
This guy speaks and it sounds like a step by step guide of “ways to get arrested for fraud unless your a billionaire”
Who can rent a full million dollar house that also doesn't have enough money to buy their own?
It depends where the house is located. If it's in a Blue state then you're toast. If you're in a Red state then you can easily foreclose or evict the occupant.
If you can afford a home that expensive, you wouldn't be stupid enough to take a deal like that anyway.
If it is a primary home he should not rent it out. Problems with MTG company, insurance... Not easy said and done
And pray that they don’t file bankruptcy and you have to make the payments for 2 years while their bankruptcy is in court
I keep hearing more and more people calling this dude a fraud and a scammer!! Anyone else been seeing a lot of that!! I’m sure they’re all sleazy businessmen but idk man when there’s smoke there’s fire and it has been multiple big name sources
And what happens when the government raises % rate 12 times in 13 months like here in Australia and your mortgage is doubled ??
Big difference between renting and owner financing. Which is it grant? If you sell it, the buyer pays property taxes and insurance. If you rent, you have to maintain and pay taxes
GENIUS!...Except it's called a "wrap around contact" oh yeah, and it's illegal!
The more Grant talks, I start to think he doesn’t have any friends and HAS to walk around with security.
If only we could lock the rate in for a mortgage for 30 years in Canada. We have to renew our rate every 5 years or so but never 30 years.
There's a WHOLE LOT Grant is leaving out, please people PLEASE Don't listen to this guy he a straight Hustler .
You forgot to factor in the risk... Who's going to pay for that when the tenant doesn't who's going to pay for one attendant destroys the place or the hot water heater goes out or the AC goes out.... Somebody explain to me that????
, Most mortgages have a due on sale clause. You can’t normally transfer ownership without paying the existing note. So, maybe this would work but you better read the fine print.
This is literally why the existing homes housing market is soooo effed right now. No one wants to sell a 2.8% mortgage to go pick up a 7% mortgage.
The buyers gets the home owner financed at 6%, the seller will still have the 2.8% loan with the bank.
Nice! Encouraging others to willfully violate the “due on sale” clause. That’s pretty awesome!😅
This is not how it works. It is a land contract, which is legal, but a person paying for a property is entitled to the principal. Thus, you don’t just get to keep everything of the buyer missed payments and defaults in the loan.
Most mortgages Don't allow the house to be rented. Read the fine print. Most won't let you do what this guy is telling you to do. I was in the rental and buying selling of real estate for 35 years.
Making 3.2% on 4 mil sounds like a bad use of 4 mil. You can get a 4% + bond
I am doing this deal with a great guy that sold me and my wife the house at 6% better than bank for us and if we don’t pay we basically have rented the house.
This is why houses are unaffordable. We have a looming bubble on the horizon and it is because houses aren't selling.
Most banks will not let you do a land contract. If they find out, and if its done right, they will force a payoff. You will lose.
Did you notice when he said "don't sell it, rent it". The bank can not call your loan due when you rent your home.
I've done this, the banks don't care.