• Instalment Contract Case Study | Part 2 [Audio]

    How I helped my mentee secure his Dream Home and pocket in excess of £3000/month cashflow with an Instalment Contract

    I met with the seller who as you can imagine was highly distressed. She was in arrears with her mortgage by approximately £12,000, her tenant wasn’t paying rent and she had no idea how to negotiate with her lender on the monthly payments. I very quickly built rapport and trust with her to bring her on board so that I could stop the repossession and give her the peace of mind.

    The situation was highly complicated and time was of the essence.

    Listen To The Case Study Details [Part 2]

    To cut the story short, the repossession was imminent, the tenants were refusing to leave and the owner wasn’t seeing eye-to-eye with Mesud. Through gaining her trust and with her feeling that she could confide in me we were able to make progress and create a win-win solution for all parties.

    I was able to negotiate with the lender to stop the repossession without paying a single penny towards the arrears and also managed to reduce the monthly payments. This could be seen as a minor miracle.

    I had to then put measures in place get the tenant out of the house. When they did leave, they left the house in a very bad state.

    Mesud asked me to joint venture with him so that I could make the mortgage payment and fund the renovation of the house. As a result, the house is now a beautiful 7 bedroom property where Mesud and his wife are living happily.

    I’m really proud that the end result was that I stopped the repossession, negotiated the monthly repayments, negotiated the arrears and there was also a redemption penalty that we parked and now we have finally completed on the deal Mesud and his wife moved into the house and on top of that, they are renting out the rest of the rooms and making in excess of £3000 cash flow every month.

    To achieve this positive result he employed an Instalment Contract strategy, with very little money in (no mortgage).

    Watch The Second Testimonial From Mesud
    The way we structured it, is that the mortgage account balance was £230,000, the arrears were around £12,000, the term of the mortgage was 17 years remaining, the monthly repayment was £1,800 and there was also a £9,000 redemption (which wasn’t a worry as it wasn’t being purchased). So the purchase price for Mesud was £230,500 to be paid to the owner within a seven years period. This option would be exercised subject to a valuation of £310,000 and to give an incentive to the seller, if the property were to be valued higher, she would receive a higher amount. On top, because she needed some money we negotiated she would get £1,000 for five months so Mesud could manage his cash flow. So it was creatively structured so that it was win-win, Mesud could get what he wanted and the seller got what she wanted.

    I am really pleased yet another one of my mentees and his partner Doug has flourished following my support. Doug, an ex mortgage broker who did not believe in these creative strategies has now embraced it with with conviction!!  They are now going out and putting what they learned into practice in other deals.

    instalment contract case studyI pride myself on realising there isn’t one solution to every problem. Instalment contracts aren’t the answer to every problem, it’s really about finding the right solution for the problem – it’s about diversifying your solutions and knowing which one applies.

    There are lots of people teaching instalment contracts, but it’s not as simple as it looks. More than anyone, I understand there isn’t ‘one size fits all’ and you need to know a few different ways of doing things and lacing them together to do a deal and that’s why the people I teach come out with great success stories.

    I’m very proud that I have a skillset that means I’m good at negotiating and can read between the lines, see what creates a win-win situation and get on it very quickly. I transfer my skillset to my mentees and as a result they are as successful as I am.

    If you want to find out more about instalment contracts and other creative property strategies, call me on 0203 397 7030 or arrange a call back

    See Instalment Contract Case Study Part 1

    About Reena Malra

    Connect with me: Google+ Reena Malra is one of the UKs most successful property investors and mentors. The strategies Reena has discovered and developed over the past few years take the focus off the price and put it on the flexible and convenient payment terms. This is how Reena can structure transactions to really benefit both the buyer and the seller. Reena specialises in property lease options, instalment contracts, rent torent, below market value (BMV), stopping repossessions, joint venture, delayed completion and tenant buyer strategies. She also runsworkshops and webinars, and offers property consultancy services and one-to-one mentoring.

    View all posts by Reena Malra

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    1. Instalment Contract Case Study | Part 1 [Audio] | Reena Malra - February 24, 2013

      [...] See part two of this Instalment Contract Case Study [...]

    2. Instalment Contracts | Don't trick the system.. Use the System! - March 14, 2013

      [...] Instalment Contract Case Study How I helped my mentee secure his Dream Home and pocket in excess of £3000/month cashflow with an Instalment Contract Part 1 Audio Part 2 Audio [...]

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