3 Days To Make Decision, Please Help
I have some seriously motivated sellers with a home less than 5yo that appraised for $243,410 (in 1999) on 7 acres of land. They owe approx. $190k, but are willing to sell for a little less to get rid of the home. They are divorced, hate eachother, nuff said. The ex-husband is going to go through bankruptcy within a week if something isn't settled one way or the other so I have to move on this fast to make something happen. I went to look at the property today. My concern is that it is 20 minutes from a town of approx. 18,500 people in one direction and approx. 35 minutes from a smaller town in the opposite direction, so it's in the country. The house is 2 story red brick 4/2.5 with attatched 2 car garage and the only thing visibly wrong is scratches on the beautiful hardwood floors on the lower level from moving out. How should I structure this? Anyone see real problems here rent-to-owning an expensive property 20 minutes out of a small town? I don't want to get stuck with a beautiful home on a nice piece of land that I can't move. Please help, any advice would be most appreciated.
The questions are: What would be the best way to structure this deal (acquire the property.) and does anyone see real problems with this I should look out for other than the obvious?[ Edited by dmbaker on Date 04/14/2004 ]
Hello,
This seems to be the typical candidate for L/O. Offer the home owners a sales price of $233,410, minus $10k for repairs and geting the floors in good shape before closing. Have them sign a 48-60 month L/O. Advertise in the locals, and don't forget your bandit signs on the property as well as on every busy intersection near the home. I usually charge anywhere between 3-5% for option money, so with this lease here if you think you can get it, charge between $5-7K for option. To get a T/B quickly, don't mention the option consideration, if they ask what you need down; ask them what their budget can handle. Never take anything under $2500. Structure your deal to cover any taxes or maintanence cost, and collect on the income stream.
Good Luck!
No offense, blaqmyst but I think thats a really bad idea.
They've already said that they will take less than $190,000 to walk. Why offer them more?
If you're worried about renting this house then don't. Sell it. Enter into a purchase contract for $175,000 with a mortgage contingency and a 90 day closing. Get the right to enter and show the house (supposedly to your prospective tenants) during the contract period (this shouldn't be a big problem since they've already moved out.) List it immediately with a broker for $250,000 with double whatever the normal commission in your area is if the thing can close in 90 days.
Now that sounds great! I put a offer in for $165k cash but they hee hawed about. Guess I would too. I bet if I come back with $175, but a 90 day closing they'll do it! Good idea! Thanks.
It sounds like time is of the essence. Since the house only needs minor repairs offer them the total payoff. The last thing you want involved in this is the bankruptcy court. Try to L/O the house to a buyer who will close and cash you out in 2 years for at least $300,000.00. Try to keep real estate agents out of this deal.
Oh, did I fail to mention they hired an agent 4 days before I found them? I didn't did I? She's not coming off her 6% either! I'm trying my best to make a cash offer that falls within my investor perimeters. We generally don't pay cash for any property unless it's 70% or better of FMV. I'm trying to persuade my partner on this one though as it's not too much higher. Thanks for all your replies, time IS of the essence on this one. Michael, I believe I looked at one of your properties in Centerpoint when I first started this busines last year. How's the wife?