How To Buy With The “Multi-Mortgage” Technique To Give The Seller His Equity


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In this video, you will learn the “Multi-Mortgage” technique.


This is a great way to structure a deal so that it gives the seller some of his equity and makes it more likely for them to do the deal.

If you understand all of the structures in my hierarchy, you will be able to make an offer on ANY property so that it is profitable to you and likely to be accepted by the Sellers.

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Read Transcript for “How To Buy With The Multi-Mortgage Technique To Give The Seller His Equity”

What are “Multi-mortgage” deals and in what circumstances should they be used, and how do you use them to give the sellers their equity? In this video, I’ll explain it to you and how to do it in ways that profit you as well.
Joe: Second in this structure is called “Multi-mortgage”. This is a structure that I created simply because there weren’t any others out there. You’re still taking the property Subject-To but this time, that property may have some equity in it.
Joe: When you take most properties Subject-To, they’re going to have mortgages up to the value of their property or within 70-80% of their value and it’s easy to take those properties over and get that equity for free. But let’s say somebody has a property and they only have a mortgage on it that’s 20% of their equity. Let’s say it’s a property that’s worth $100,000 and they owe $20,000 on the mortgage right now.
Joe: What you can do is take that property from them, buy that property from them with Multi-mortgage and get them their equity. Let’s say it makes sense for you to pay them $400,000 for that property and let’s say it’s worth $100,000. You’re going to be able to get $1,000 of income on it and your payments overall aren’t going to be more than say $900 a month with taxes and insurance and property management – that property might make a lot of sense to take over.
Joe: So to do that, what you have to do is put a second mortgage on there. The seller deeds you the property, you start making payments on the first mortgage or first trust deed that’s on the property, and then we have a second mortgage that’s on the property where the beneficiary is the owner or the seller of the property. So they’re going to have an $80,000 second on that property that you’re going to make payments to. If you default, they can take the property back from you, so they’re protected, and you – you’re on the deed so you’re protected and you’re given a stronger position because you’re on the deed. And you’re going to make payments to them.
Joe: Alright, so that’s the top two structures, “Subject-To” and “Multi-mortgage”. Of course, as you go down the structures, you have less and less control of these deals. It doesn’t mean it doesn’t make sense to do them. “Multi-mortgage” usually makes just as much sense as a Subject-To, although I’d much rather see you negotiate a much smaller price when you do a Multi-mortgage.


  1. September 22, 2010 at 7:09 am ·

    Only buy with a multi-mortgage when the total purchase price (total mortgages) is BELOW the market value. Also, make sure the combined monthly payment is below market rent.

    Hi Jerrie,
    Multimortgage is a way to give the seller his equity without having to buy with a land contract. It’s better because it puts you on the deed. A land contract doesn’t do that. I normally only use a land contract when I’m SELLING a property.

    The beauty of having all these different zero down structures is that you can solve the problem for the seller and still make it work for you.

    Hope that helps,

  2. September 20, 2010 at 10:55 pm ·

    Hi Joe,

    With Multi-Mortgage, You still have the payment on the first mortgage at a rate of what the original (PITI) is, (assuming they have no refi) plus if you give them a 2nd Mortgage/Deed of Trust at the high Equity value of let’s say, (What your Example is) $ 80,000…You could paying way over what the property value is ?

    Original Mortgage $ 100,000
    Owe $ 20,000
    Equity $ 80,000

    1st Payment (Example) $ 900

    You can not Multi Mortgage the $80,000 equity with the original payment of $900

    You can only do Multi – Mortgage if they Refi’d the Equity recently to make the numbers
    Work out

    Is this Correct ?

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