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Discussion in 'Property Market Economics' started by Dean Collins, 5th Feb, 2019.

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  1. Dean Collins

    Dean Collins Well-Known Member

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  2. Trainee

    Trainee Well-Known Member

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    Scary. Sell with an option to buy back? At what price? If the borrower only has access to this sort of funding now, unlikely theyll be able to repair their credit and buy back later.
     
  3. Dean Collins

    Dean Collins Well-Known Member

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    yep the big problem is that the "owner" takes the risk on property values falling (eg they turn themselves into senior notes lender with priority in their contract).

    Makes me wonder if there isn't a good business model here.......but without the gotchas.
     
  4. Trainee

    Trainee Well-Known Member

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    Doesnt stamp duty make this too expensive to work in australia?
     
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  5. Dean Collins

    Dean Collins Well-Known Member

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    Possibly but you could implement a notes debt system without a stamp duty event.
    The only problem with their system is they only buy partial.....which means original owner still on the hook for any shortfall. Contract would need to be worded otherwise for me to ever consider something like this.