Pay Cash Don’t Finance Your Deals (CFFL 447)

Pay Cash Don't Finance Your Deals (CFFL 447) Jack Butala:                       Jack Butala with Jill DeWit. Jill DeWit:                           Hi. Jack Butala:                       Welcome to our show today. In this episode Jill and I talk about why it makes a lot of sense to pay cash for deals and not finance them. Before we get into it though Jill let's take a question posted by one of our members on the landinvestors.com online community, it's free. Jill DeWit:                           Okay. Brian asks, "Hey I'm considering buying more expensive properties on terms. Since the seller financing would be arranged between myself and the seller, what problems might this bring about with turning around and selling the property to a new buyer? Is there a way to write the contract so it doesn't present a cloud on the titles to the new owner? Ethically, of course." Jack Butala:                       So a cloud on the title is the least of your worries. So let's take a couple steps back real quick. Brian's got a seller, he's got a seller for property, let's say the guy wants 10,000 bucks instead of maybe the 4,000 that he's asking. So he's thinking, "I'll just pay terms, I'll put a thousand dollars down. I'll make a hundred dollar a month payment, and man if it's not gonna take long for me to sell this thing for 20 grand." So what the anatomy of that really is, an option, or do a close. So rather than complicate the heck out of this thing I would pay the guy 500 bucks, non-refundable, for an option. Option to purchase at ten grand. Now you don't have to make any payments. Let's just make it for six months, and that's it. Jill DeWit:                           Exactly. Jack Butala:                       I don't think it's a good idea to leverage anything in this business at all. I've seen a couple of people who are very talented, long before we started Land Academy, just train wreck their careers this way. Jill DeWit:                           It's too scary, there's too many things that could go wrong. What if there's, I don't know, like something happens to the guy, I mean in the process. And you're wasting a lot of money like you said, I think. Jack Butala:                       I'm not a fan of financing at all, on either end for land. Jill DeWit:                           I'll tell you though- Jack Butala:                       It's a crutch. Jill DeWit:                           ...well here's the thing- Jack Butala:                       It's a crutch for negotiating a good deal. Jill DeWit:                           ...for all of our options deals, I've never given any money. Jack Butala:                       I've never even considered this concept in my life, and I never will. Jill DeWit:                           You don't even have to. I appreciate your $500, whatever fee, if you really feel like you need to. But I've never had to do that. I've sold them quick enough, and it worked out great. Jack Butala:                       Yep. Jill DeWit:                           So, good question though. I'm glad that he's, hey thinking outside the box. Jack Butala:                       Yes, exactly. Jill DeWit:                           I do really appreciate that. Jack Butala:                       I agree. That is a great question and it's totally unique. Jill DeWit:                           Exactly. Jack Butala:                       And the meat of the show here we're gonna talk about why it's super- it ties totally into the concept of the show here. Why it's important with these smaller deals to pay cash. If you have a question or you want to be on the show, reach out to either one of us on LandInvestors.com. Today's topic, pay cash, don't finance your deals. This is the meat of the show. So ever since I started this crazy buyin land and sellin land on the internet thing in the '90s, my concept from day one and right up to today has been: pay cash.