Students, get your rent back when you graduate!

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1

Aside from being a car enthusiast along with my regular job, I am also a small real estate investor. I have an offer for you students.

If you are going to school full time and are paying rent you need to consider this seriously.

I will help you buy your first home so you can stop paying rent and drastically reduce your student loan debt when you graduate.

Here is a rent example using some simple math (insert your own numbers)…
Your current rent = $700 per month
x 48 months to complete degree =$33,600 given away to a landlord.

Here is a ownership example…
$200,000 purchase price.
I give you $10,000 down payment.
You make mortgage payments no different than you did when you were paying rent. You can even get roomate(s) to reduce your payments.
When you graduate we sell the house / condo.
I get my down payment back at that time and we split the equity in the house.
You use your half of the profits to pay down your student loan.

And the best part, you didn’t give your money away to a landlord for all the years you were in school.

PM me if you are intersted.

Dave

2

u know your actually pretty smart in thinking up this, because it is totally true. Most students cant buy a house because of the down payment. But you are chipping in for the down payment and in the end your practically going to gain on the value of the house.

Im sure 99% of ppl that would consider doing this with you, would defiantly need a legal contract that says you dont get all the profit on the house, and that the student cant run with your 10,000$.

Good luck with you business endeavor. Id go to NAIT, Grant Mac., and UofA and post a sheet with all your stuff on it, im sure you will get a few ppl easier that way.

3

You are correct; it is called a joint venture agreement. Protects both parties. Everything spelled out clearly so everyone is happy.

Thanks. …and I do plan on advertising at the UofA, MacEwan, Nait, etc., but I don’t have hundreds of thousands to go around to everyone so thought I would give my car buddies first crack at this.

4

holy crap if only i read this 4 months ago,
when i finish my practicum ill give u a holler

5

sure.

I posted this on 780 too…not sure I should have :rolleyes:

Here is a bit more of what I wrote there in response to some healthy skepticism:

I understand the skepticism. It is okay but I think before this turns into a fiasco I will explain some more…

I am doing this for a few reasons:

Obviously I am doing it to make money. I would never give someone my hard earned money without anything in return. I think that is a reasonable expectation.

I also remember what it was like to graduate from university with tens of thousands of dollars in student loans and that it took me 12 years to pay it off. I don’t like the idea of how much an education costs kids now days and how screwed they are financially when they graduate. I would like to help.

I make money and the student makes money. I am not sure that is a bad thing. The more people I can help with this the more money I make but the more people I help. It is so cool.

Yes, I will legally and legitimately own half of the property but I am putting up the down payment and taking the financial risk. The student puts nothing down and pays basically the same in mortgage payments as they do in rent anyway. I like this arrangement because besides my profit down the road, it helps people out. It is also better for students to own half of something than 100% of nothing. Both parties are protected in a legal document called a Joint Venture Agreement.

There is no shady scam or unwritten deal. Of course everyone will judge for themselves. When I do this I always insist on my partners obtaining their own legal advice.

Lastly, there is the mortgage, insurance, and maintenance to consider. There is always an option of arranging the agreement to make these work for both parties.

Joint Venture agreements are done all the time. Everyone has heard about two individuals being business partners…that is, in essence, a joint venture. This is just unusual for people because it is for real estate and they are not used to this.

People are going to be skeptical when they see something that isn’t traditional way of doing things. That is understandable. Skepticism can be good…it can protect you. Having said that, it is also a good rule to investigate things before dismissing them outright.

6

i would defiantly jump on this if i was paying a shit load in rent. with the proper legal documents you wont get screwed as long as you have common sense. plus i dont think dave is the kinda guy to screw ppl out of their money. especially students haha.

7

I consider myself an honest character and there is no benefit to screwing someone over but no one should just “trust” that it will all work out. It is all done up nice an neat by the lawyers to make sure it works out. :partyman:

8

If your a 1st time buyer you don’t need a down payment (as long as you have perfect credit). We just bought are 1st house with zero down. :partyman:

The CMHC lenders have a new program out that give the 1st time buyers with perfect credit a better interest rate then most people who put down 25%.

I went through Dave @ mybestmorgage.ca Awesome guy to deal with.

9

Yep that will work for some people. Good for you Josh. :thumb

10

have fun finding a decent spot for 200k ahah otherwise its a good idea.

11

If you are splitting the equity in the end, wouldn’t that leave the student in debt ($100,000)-(x years of mortgage payments)?

Or are you anticipating that the property value will drastically increase/double?

12

Oh sorry I think I just answered my own question.

Right at the purchase of the property and signing of the agreement the ownership of the property is split in two, leaving the student and yourself each half of the remainder of the value after it is sold if the property increases?

13

Assuming first of all that you are dealing with someone you know fairly well, and that your name is not going onto the mortgage or the title, you are paying more than market rent for the unsecured promise of a return on your money.

If only you are going on the mortgage and the title, and this guy is investing the down-payment in return for half the equity, he is in fact putting up 5% of the equity for 50% of the upside with no personal risk at all other than the money he’s fronting (for which I am sure he will put a lien on the house for so it is virtually risk free in a rising market. That is a pretty sweet deal for him.

If you and he are going on the title and the mortgage, and you are paying the mortgage payments, he is taking credit risk (that you won’t pay the mortgage) and is effectively cosigning for you where you may not qualify for a mortgage. Assuming his credit is PRISTINE, the bank MAY go for this, and his interest is in obtaining rental property financing at 5% because it is YOUR primary residence – the banks would not finance this set up knowingly as ordinarily rental property requires 35% down and if in CMHC territory (less than that down) they charge exorbitant fees.

What I would suggest to you to do is find out from your bank whether you qualify for a mortgage on your own. There are also 0% down CMHC mortgages but the qualification criteria are actually fairly tough, but start by asking for one of those (then the government is taking the risk, and only charging about net 2% for the service of ‘cosigning’ your loan. Better still, beg borrow or steal the money (from someone you are related to preferably) for the downpayment and save some money on CMHC fees.

I would be VERY hesitant putting my name on a major financial instrument such as a mortgage with someone I wasn’t at least fucking. There are many mortgage scams to numerous to mention here and this may or may not be one of them.

14

Ya, you can get mortgages for 0% down, but you’ll be paying nearly $10,000 just in CMHC (insurance that you’ll make your payments) fees over that period.

I vouch for Dave. There wouldn’t be too many others out there that I would. He’s a good guy.

Also, Dave, where are you finding a home for $200,000? Those exist still? I think the average cost of a home in Edmonton right now is $380,000

15

Sure there are some fees but there all included in the mortgage, but everything done including lawyer fees was a tad over $8000… over a 25yr- 35yr deal that is nothing. We knew about the frees before hand and made a lower offer to keep are mortgage payment in the range that we wanted. So if in a few years the value jumps up 30% or what ever there’s no one to split $$$ with but your self. When we were 1st looking for a place we checked out Comfree.com. The first few people on there that we contacted wanted to play banker and finance, or work adeal were they were still making money of the house after it sold. Seemed kinda sketchy so we went old school with Remax…

Not trying to say daves a bad guy or anything…

16

It was just an example for easy math. :wink: