Choosing the Right Business Partner (LA 749)
Transcript:
Steven Butala: Steve and Jill here.
Jill DeWit: Hello.
Steven Butala: Welcome to the Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.
Jill DeWit: And I'm Jill DeWit, broadcasting from sunny Southern California.
Steven Butala: Today Jill and I talk about choosing the right business partner.
Jill DeWit: Not life partner.
Steven Butala: Well, it's gonna become that.
Jill DeWit: Business partner.
Steven Butala: Both of us said right before this show, "I have a lot to say."
Jill DeWit: Ha.
Steven Butala: So we both have a lot to say.
Jill DeWit: It's true.
Steven Butala: It's all good stuff. Before we get into the show though, let's take a question posted by one of the members, one of our members on thelandacademy.com online community. It's free.
Jill DeWit: J.T. asks, "Hey all, I've been investing here in Texas over the past year, and have done well, picked up around 10 properties"-
Steven Butala: No he's speaking like a Texan ... he's typing like a Texan ... "Texas over the past year and I have done picked up around 10 properties, selling them all for cash"-
Jill DeWit: Oh! Okay. "Recently, however, I have become very interested in terms properties. It seems like, here in Texas, you can sell a property on financing, but the deed will go into the buyers name and you would hold the note like a bank. I really like the sound of the Arizona land contract that Jack and Jill have talked about on the podcast. My understanding is that you have the contract and don't deed the property until the full amount of the terms have been paid." True. "My only concern is just that because of the successful mail campaigns of Land Academy members the market in Arizona might be over-saturated as far as cheap rural land is concerned. I might be entirely off-base with this, but my question is: Has anyone over in Arizona sold properties on very friendly terms, I.e. $99 down, $99 a month, and if so have you found it sells quicker than all cash? Additionally, has anyone sold properties on terms in any other states that you do a land contract similar to Arizona? Appreciate any response or any opinions on this."
Steven Butala: Okay, here's the deal. There are two types of ways ... two ways to sell property on terms. Land contract which he's calling the Arizona way. And a deed of trust which is how you usually purchase a house. You buy the property it gets put in your name and there's a lien on it and the bank holds the lien until it's paid off. Those are ... local laws and rules dictate which way you do it. In Arizona, it's legal to do it both ways, but there's ramifications for both ways, like everywhere. In some places, it's not legal to do it the land contract way or it's not allowed. Is it enforced? No. Do you drive 75 in a 65 every single day? Yep. It's the same thing.
Jill DeWit: Isn't that funny?
Steven Butala: Am I advocating breaking the law? No, I'm not advocating breaking the law. What I'm advocating ... I'm just here to tell ya the truth. And I want you to check into it before you go gun slinging 'cause you're in Texas.
Jill DeWit: You bring up a valid point. You need to be aware of everything, slash, however, whatever agreement ... it's like if I wanted to sell my brother-in-law my car and I accept $100 a month for 3 years or whatever it is that's between us.
Steven Butala: Yeah, well, you're probably breaking the law.