A Terrific Deal... But HELP!!!
I have a client who has had some mortgage problems. She was pretty close to loosing her property. She has asked me if I had any ideas on how to help her this time? I suggested she let me buy the property for what she owes on the property and that since her home has nice equity in it, we will work the selling price to include her outstanding debt plus about $10,000 for me :-D . She would then sign a lease agreement with me for the new mortgage. In a year or 2 she would then buy the property back from me for the same amount plus an additional $10,000. HELP me structure this and how do I get a lender to finance 100%. Would they??? How do I get the $10k at closing without the lender having a problem? Background: She brought this property in 1997 for $122K and the area (her neighborhood) is selling now for @$225K. The sale price will be around $170K. Could I get some wisdom here? Thanks in advance. :-? [ Edited by CoolB on Date 04/26/2004 ]
Best advice. Don't do it. It's never a good idea to buy a property and leave the old owner in it. There are simply too many possible legal troubles for this to be worth the effort.
Roger
I would tend to agree. There could be a nice deal, but leaving her in it would limit your ability to get out. You can still help her out by structuring a deal that sees her leave.
I would take it over (vacant) subject 2 (no need to get a lender), then sell. If you wanted, you could offer to split the profit with her to help ease the transaction. This could cover her outstanding debt.
Well I agree its probably a bad idea but you seem to want to help this lady out so you gotta start by asking how she got into this mess in the first place. What's changed that she won't be back here in a year.
You say she is your client. In what way? What is the nature of your relationship?
Assuming the worst happened and that you ended up having to foreclose and throw her out are you willing to do that?