A Pactrust ™ Deal Part (5 of 5)

Contingency Fund (to be used to kick the co-beneficiary out if I ever have to) Now, when the trust and the accompanying lease agreement terminates, the property will be sold; all costs of sale will be paid; I will get back the equity that I carried (the difference between the loan amount at start and the $160K the resident came in at; the resident beneficiary will receive a refund of his $5,000; and all remaining proceeds will be divided between the resident beneficiary and me. August 22, 2001: So far (2 years into the deal), that property has increased in value to about $210,000; I receive a $100 positive cash flow each month; the loan has paid down by about $3,600. I therefore have earned approximately $33,000 on an over-encumbered property that no one else wanted, and which involved No Down Payment, No Credit Application; No New Loan; No monthly payments; No management; No maintenance, No up keep or refurbishment costs. Furthermore, the lender’s Due-on-Sale clause was not violated; the property is protected from credit and tax liens, bankruptcies of any party; marital dispute actions of any party’s spouse and Probate should any party die. Cool, eh? Bill Gatten