A couple of years ago, I invested heavily into real estate – more so than I had ever done.

The years 2020 and 2021 were record-breaking for me as an investor—I was flipping houses left and right, taking on challenging projects, and helping clients renovate homes. I had been investing in real estate since 2017, but by 2020, I was tackling huge, high-risk properties, one of which was a 4,000-square-foot historic home from 1885 (but that’s a story for another day).

I had cash, confidence, and a great relationship with the bank. So, naturally, I did what any ambitious investor would do: I overleveraged thinking I couldn’t lose. And that’s when I made a decision that nearly cost me everything.

The Listing That Became My Problem

It all started with a listing on Turtle Creek. I was selling a home for a client, and it was generating a ton of attention online. In theory, this should have been an easy sale. But there was a problem—the house didn’t show well. It smelled. It was cluttered. The DIY “renovations” were questionable at best. And, oh yeah—there were tons of animals. I had done my best to get great listing photos, but once showings started, buyers were immediately turned off. The house was in a great neighborhood and priced well, but some people wouldn’t even make it past the front door.

My client—who also happened to be an old friend—was stuck. And after over 100 days on the market, multiple price drops, and nothing but negative feedback, I knew she wasn’t going to get a reasonable offer.

So, I made one myself.

I ran the numbers, calculated the ARV (After Repair Value), and negotiated a deal that made sense for both of us.

The Nightmare Begins

I had given my client a 10-day leaseback for free so she could move out after closing. That turned into more than two weeks of excuses and delays. When she finally handed over the keys, I walked in expecting to get started on renovations. Instead, I walked into a disaster. Trash, abandoned furniture and personal items left behind—it was as if they had left in the middle of the night and never looked back. The house was filthy. But I didn’t have time to be mad—I had work to do.

And then came the next punch in the gut: the property needed way more work than I had originally anticipated.

A Six-Week Flip Turned Into a Six-Month Money Pit

The condition they left the property in set me back over two weeks, just in cleaning up and removing all the junk they abandoned. What should have been a quick, six-week flip spiraled into a six-month nightmare—a project that consumed my time, energy, and every ounce of patience I had left.

The foundation was a ticking time bomb. What I initially planned as a minor leveling job quickly escalated into more than twice the work I had expected. The moment we started the repairs, new cracks appeared in the walls, doors wouldn’t close properly, and it became clear that what we were dealing with wasn’t just minor settling—it was a serious structural issue that had been neglected for years.

The pool, which I had initially thought needed some routine maintenance, turned out to be a complete money pit. The plaster was cracked and crumbling. The filtration system was outdated and barely functional. The deck had multiple structural issues, and beneath the surface, we discovered major leaks and had to replace the pump.

And then there were the cosmetic upgrades, which should have been the easiest part of the project. New floors, fresh paint, updated trim—normally the finishing touches that bring a home to life. But after months of unexpected repairs, blown budgets, and delays, these once-simple tasks felt like the least of my worries.

And just as I was preparing to finally list the house for sale, the real estate market took a negative turn.

The Market Shift That Changed Everything

By the end of 2022, mortgage rates had skyrocketed past 8%—the highest in decades. Buyers who had been eager and aggressive the year before were gone. Homeowners with low-rate mortgages refused to sell, keeping inventory painfully low. And those who did want to buy? They could no longer afford the payments. I had gone from selling 44 homes in 2022 to just 7 in 2023.

Seven.

It was a nightmare.

Every dollar I had was tied up in real estate. My sales business had slowed to a crawl. My property management company wasn’t profitable yet. And to make things worse, I had just purchased a new personal home, adding another mortgage to my already massive financial burden.

At this point, I was bleeding $15,000 a month in mortgage payments.

I had to act fast.

The Owner-Financing Deal

With every passing day, my financial situation was becoming more unstable. The real estate market had turned, and I was bleeding money from multiple properties, each one eating away at my reserves faster than I could replenish them. I knew I had to act fast, so I made the decision to rent out the house I had just flipped—not my original plan, but at this point, my goal was survival.

I listed the property for lease, and almost immediately, I had an interested tenant. They submitted an application, and while there were some red flags, they seemed great. I decided to approve them. I breathed a small sigh of relief—this would at least slow the financial hemorrhaging. Then, at the very last minute, they backed out. No real explanation, no warning—just gone.

I was frustrated but tried to shake it off. This wasn’t my first time dealing with flaky renters, but in my current situation, I didn’t have the luxury of waiting around. I needed a new plan, and fast.

A few days later, my phone rang. It was a real estate agent. She had a client interested in purchasing my property. For a moment, I felt a flicker of excitement. Maybe I’d get lucky and be able to sell instead of rent. But as she kept talking, my excitement shifted into confusion. The buyers she was representing? The same couple I had just approved for the rental.

Except now, they weren’t looking to rent—they wanted to buy the house through owner financing. I hesitated. I had never structured an owner-financed deal before. It wasn’t something I had experience with, and my gut instinct was to steer clear of anything outside my comfort zone. But I was in survival mode, and I needed to make a move. I called my lender and explained the situation. To my surprise, he told me we could do it. He walked me through the concept of a wrap-around mortgage, an arrangement where I could sell the home while still keeping my original financing in place. The buyers would make payments to me, I would continue making payments on the existing loan, and I’d collect the difference as profit.

The numbers looked solid.

✔️ $470K sales price
✔️ 20% down
✔️ They covered their agent’s commission
✔️ A short two-year balloon note, meaning I’d be paid in full within 24 months

It seemed like the perfect solution.

At first, things went smoothly. They were a little late on payments here and there, but they always let me know in advance. And honestly, I was just relieved to have a consistent income stream.

The Foreclosure Battle from Hell

Then, the payments stopped.

At first, I gave them the benefit of the doubt. Maybe they just forgot. Maybe there was a banking issue. It happens. My team reached out—emails, phone calls, texts. Nothing. We tried again. And again. Weeks passed. Still no response. The silence was deafening. Then came the threats.

At first, the messages were passive-aggressive. A few comments about how the house had more problems than they expected, how they had to put money into repairs. But it quickly escalated. They started sending long, hostile texts and letters, claiming that I had sold them a bad house, that I had tricked them into buying a money pit. They said they had been forced to pour over $20,000 into repairs, as if I had somehow hidden these issues from them.

Then, the real threats started.

They told me not to make them angry. They accused me of being dishonest, of running a shady operation. They claimed they had talked to other agents in the area who all said I was a fraud. They hinted at legal action, at retaliation. The tone of their messages became more aggressive, more personal.

I knew better than to engage. I didn’t respond. I got an attorney.

My attorney assured me they knew this type of client. They sent a letter back demanding them to cease contact with me. Then, we filed foreclosure.

And just when I thought I could finally move forward—they filed for bankruptcy a day before the auction.

Everything came to a screeching halt. The foreclosure process was immediately frozen. Legally, my hands were tied. They were still living in my house—without paying me a single cent—and there was nothing I could do about it. For eight months, I was stuck in legal limbo, pouring tens of thousands of dollars into attorney fees while they continued living in my property for free. Every month that passed, I watched my financial situation get tighter, knowing that not only was I losing money, but I was also paying out-of-pocket just to fight for something that was rightfully mine.

And then, after months of battling, after finally getting a court date, after pushing through the legal system to get the foreclosure process back on track—the second borrower filed for bankruptcy.

I couldn’t believe it. Again?

It was like being trapped in a nightmare I couldn’t wake up from. I had heard about people who played the system like this, who knew the loopholes, who could stall legal action for months—even years—but I had never imagined I would be their next victim.

Fourteen months. That’s how long it took. Fourteen months of exhausting legal battles, endless paperwork, and more than $100,000 in legal fees, taxes, insurance and mortgage payments before I finally got them out. And guess what?

Destroyed.

It was like Deja Vu from the first time I bought it. Trash and debris covered the floors. Appliances were broken, fixtures ripped out. Carpets soiled. They had let filth pile up for months. It wasn’t just neglect—it was intentional destruction.

This was the house I had spent months fixing, pouring money and time into. The house I had hoped would be a stepping stone toward something greater.

Instead, became a cautionary tale—one I would never forget.

What I Learned the Hard Way

These buyers knew exactly how to manipulate the system, wielding bankruptcy like a weapon to stay in my house without paying. Every delay, every legal loophole, every strategic filing was carefully calculated to buy them more time while I bled money.

I poured over a hundred grand, battling to reclaim my property. And when I finally won, when the house was back in my hands, the fight wasn’t over. The damage they left behind—both financially and physically—forced me to spend even more just to bring it back to life.

But despite it all, I refuse to be bitter.

Because through this nightmare, I gained something invaluable. I now understand the complexities of foreclosure, bankruptcy, and owner-financing law in ways I never imagined. I built relationships with attorneys who guided me through the darkest moments of this fight. And most importantly, I proved to myself that no matter how hard I get hit, I can take the blow and keep going.

Real estate will test you. It will push you to your limits, drain you, and at times, bring you to your knees.

But if there’s one thing I’ve learned, it’s this—no matter how many times I get knocked down, I will always get back up. Wiser. Stronger. And more resilient than ever.

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Owner financing can be a great tool for both buyers and sellers, but it comes with risks and rewards. Here’s a breakdown:

Pros of Owner Financing

✅ For Sellers (Property Owners):

• Faster Sale – Attracts buyers who may not qualify for traditional loans.
• Higher Sale Price – You might be able to negotiate a better price since you’re offering flexible financing.
• Steady Cash Flow – Monthly payments can provide a reliable income stream.
• Fewer Closing Costs – No lender fees, and you can structure the deal with lower transaction costs.
• Can Keep the Property as Collateral – If the buyer defaults, you retain the property.

✅ For Buyers:

• Easier Qualification – No need for strict bank requirements or high credit scores.
• Lower Closing Costs – No lender fees, appraisals, or origination costs.
• More Flexibility – Terms (down payment, interest rate, repayment schedule) can be customized.
• Faster Closing – Without a lender involved, deals can close quickly.

Cons of Owner Financing

❌ For Sellers:

• Risk of Default – If the buyer stops paying, you might have to foreclose.
• Delayed Full Payout – Instead of a lump sum at closing, you receive payments over time.
• Possible Legal Complications – You’ll need a solid contract and may have to handle foreclosure if things go wrong.
• Due-on-Sale Clause Issues – If there’s an existing mortgage, your lender may call the full balance due.

❌ For Buyers:

• Higher Interest Rates – Typically, seller-financed deals have higher rates than traditional loans.
• Balloon Payments – Some agreements require a large lump-sum payment after a few years.
• Limited Legal Protections – If the seller has an existing mortgage and defaults, you could lose the property.
• Fewer Property Options – Not all sellers offer owner financing, limiting choices.