With the right sales strategy, buyers with the ability to “build in” equity might be an exclusive purchasing population for your properties.


works for everyone involved. For me, that means once we’re done, I don’t want to think about that deal ever again except when I get the check at the first of the month. For the buyers, it means they have a home that they could own and they are equipped to build equity and afford their loan payments,” she said bluntly. GETTING CREATIVEWITH CREATIVE FINANCING Jones-Cox combines several creative financing strategies to get her deals done, and she buys in very specific types of neighborhoods in order to maximize her chances of creating a deal that, in her words, “works for all the folks involved.” She identifies properties in neighbor- hoods of rentals that are, in general, not valued higher than about $100,000. “I often buy from burned-out land- lords,” she explained. “Often they own their properties outright and will nego- tiate owner-financing with me at zero percent just to get the property off their hands and start getting a payment every month without any more maintenance calls.” Once Jones-Cox has control of the property, she uses a land contract to offer the house to a potential buyer. Land contracts are similar to mort- gages in structure, but the buyer/ borrower makes payments to the owner/seller until the purchase price is paid in full. Depending on the state in which you invest, seller financing may be best implemented by land contract, lease-option, contract for deed, or other payment structure. “The new residents get in there, fix up the house, and usually end up paying $100 or $200 less each month than they would if they were renting, and they end up being homeowners at the end of the process.” In the interim, Jones- Cox holds the note on the property and

receives monthly payments from the buyers and makes monthly payments on her seller-financed note from the previous owner.

tractor for the past 25 years, I don’t feel very concerned about whether they can fix a broken window,” Jones-Cox added.

EXCELLENT EXIT OPTIONS While Jones-Cox prefers to hold most of the mortgage notes she creates and collect the monthly payments on them, her investing strategy allows for multi- ple fast, favorable exit strategies should she choose to employ them. “I typically do not sell my notes because the returns are really good,” she said. “If I do want to sell that land contract after it has seasoned a little bit, however, there are plenty of private investors who will buy them.” A seasoned mortgage note or land contract can show that the borrower has a history of making timely pay- ments in full. Seasoned, performing loans are very valuable. She noted also noted that if a real estate investor implements this strate- gy with the express purpose of selling off the land contract or note, they may wish to employ other structures, such as lease-options, to make the management of the note more appealing and limit the ways that both parties are restricted by federal regulations while still protecting both parties’ interests. “There has been so much government interference that has prevented the private market from creating more homeown- ers, and it comes from all directions,” she observed. “I sell homes with built-in equity to homeowners who have the ability to put in even more equity and who will probably never otherwise have the opportunity to own their own home.” •

NOT AFRAID TO SAY “NO” While Jones-Cox is passionate about her process, which she says makes homeowners of many households that would otherwise be lifetime renters thanks to banking regulations that in- herently discourage lenders from mak- ing home loans on homes priced lower than $100,000, she is also passionate about only doing these deals with buy- ers who are truly equipped to succeed with their home purchase. “This is not a good deal for some- one who is going to move in and just sit in the property the way that it was when they bought it because they do not know how to paint or hang kitchen cabinets,” she insisted. “Those folks do not have the background to make the process work.” Not only does Jones-Cox check cred- it, verify income, and run every loan through a licensed mortgage originator, she also makes a simple request: “List every kind of work you have done on a property and for whom.” “If they write down, ‘Well, I helped my mom paint her basement when I was 15,’ unless that property only needs its basement painted then they’re probably going to get a call saying that we don’t think the property is a good fit because it needs a lot more work,” she explained, adding that her team may conduct multiple interviews to determine whether a buyer is truly able to make the improvements a property needs in order to build equity. They may interview contractors and relatives in addition to the potential buyer if the buyer is relying on those individuals for help with improvements. “On the other hand, if someone tells me that they have been a full-time con-


by Carole VanSickle Ellis


n a market sector that many be- lieve is reserved nearly exclusive- ly for renters and landlords, Vena Jones- Cox, owner of and former president of the Ohio Real Estate Investors Association (OREIA), is thriving by making homes in that sector available for purchase. “There are so many people in neigh- borhoods of houses that cost under

$100,000 and in some places even less than $50,000 who want to live in those houses and own them, but they cannot get loans from a bank to enable them to do that,” she explained. “Those people are willing to do work on a property to build in their own equity and be creative in order to actually own their own home.” Those are Jones-Cox’s buyers, and business has been booming for decades.

The real estate investor and educa- tor has been building and refining her investing model, a form of seller-financ- ing, since the late1980s. Her success hinges, in large part, on her ability to educate her buyers about the terms that she is offering and a relentless dedi- cation to only working with the right buyers for those terms. “A deal is not a good one unless it

Vena Jones-Cox is the owner of and former president of Ohio Real Estate Investors Association (OREIA). She may be reached at

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