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What's the deal with those paper signs stuck to light poles "3 bed home $300 per week no deposit" ?

Discussion in 'Innovative Techniques' started by Johnny Cashflow, 27th Oct, 2015.

  1. Johnny Cashflow

    Johnny Cashflow Well-Known Member

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    Is this some sort of scam ?

    I see them all them all the time around northern suburbs of SA...
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    Vendor finance / rent to buy. The gist of it is that you pay 300pw on a place worth 200pw and the extra comes off the principle until you own it or reach an equity position where you'd be able to get a normal loan.

    However, the funny part is, in SA the contracts are not enforceable. Someone on here lost a few mil worth of property because they didn't know this.
     
  3. mja

    mja Well-Known Member

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    I didn't think you could do vendor financing in SA?
     
  4. Johnny Cashflow

    Johnny Cashflow Well-Known Member

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    So as the "buyer/ customer" you are basically trusting that the person lending to you actually signs the property over to you ?
     
  5. D.T.

    D.T. Adelaide Property Manager Business Member

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    Correct.
    Yes, but ya write up a good contract (in other states) that covers everyone's bum.
     
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  6. House

    House Well-Known Member Premium Member

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    Recipe for disaster in most cases I can imagine. Think you have to have a credit license to do these kinds of deals nowadays.
     
  7. mja

    mja Well-Known Member

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    So basically what OP has seen (in SA) is illegal.
     
  8. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Probably rent to buy or lease options. I think only instalment contracts are prohibited in SA (maybe the other way around)
     
  9. Big Will

    Big Will Well-Known Member

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    You hear horror stories of you are 1 week behind on the rent and they will not give you the property anymore.
     
  10. DiligentPM

    DiligentPM Well-Known Member Business Member

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    Vendor finance is a complicated space open to exploitation...requires sophisticated legal advice to ensure all parties interests are fairly represented
     
  11. S.T

    S.T Well-Known Member

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    I'm not selling anything
  12. neK

    neK Well-Known Member

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    @D.T. so what happened to the forum member ? How did they lose several mil of property?
     
  13. D.T.

    D.T. Adelaide Property Manager Business Member

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    Secret, sorry :p