Balloon Mortgage – Buy the balloon portion of a mortgage. A $25,000 balloon payment due in 15 years purchased at a 17.95% yield will cost $1727. A pay -off in 10 years will yield 7%, and at five years will yield 54%.
Pay Day Loans – There are more payday loan outlets in the US than thanks. Study their system. A typical loan is $250. It must be paid back in two weeks at $300. That is 20% profit, 26 times a year equals 520%. You can be the friendly lender, as long as you comply with local regulations and disclosures.
Buy Notes / Sell Partial – Buy note at a 15% yield and sell it at a 10% yield. A $25,000 note at 9% interest with 15 years remaining would cost $18,000, purchased at a 15% yield. If sold at a 10% yield to another IRA investor, they would pay $23,500. A $5500 profit for your IRA in a short period of time.
Sandwich Lease – Lease a property for $750 per month and sub-lease it for $ 900 per month, that would provide $1800 a year income and would cost a month or two deposit.
Buy for ½ – Option Back – A common procedure for the distressed seller of a property or a note is to buy the property or the note for half price and give the seller the option to buy it back within two years for half-price. This will normally return about 18% interest and possibly much more, if they do not buy it back.