$CASH$, King of "Sub-to", I need your help...

Comments(6)

• 
  JohnLocke19th January, 2003

  Tanya,
  
  Asking Price: $249.9K
  Appraised Value: $263K
  
  The owner bought a new home and just moved into it, so the home is vacant. It was appraised at $263K. But according to public records, there was a similar home in the same subdivision with the same bed/bath and approx. the same sq. footage that sold on 10/31/02 for $275K. It looks like a great deal. I'm planning on doing an "assignment of contract."
  
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  You need to look at 'comps' for the entire area find at least 3 sales showing the high, medium and low selling price add them up and then divide by 3 to get the average selling price. This is only a rule of thumb but it should be close enough for what you want to do.
  
  Let's find the real selling price in this area.
  
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  Should I get them under contract for the asking price? Or should I try offering them a lower price?
  
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  How long are the houses in this neighborhood listed before they sell? This is a very important question, when dealing with a house in this price range.
  
  This will tell you your hold time and if you are willing to pay the payments until it is sold or are the sellers?
  
  You get them under contract for a lower price than they are asking always.
  
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  When I find a buyer, what do you do next? Do you bring all the paperwork to a closing agent?
  
  Also, do you have to be at the closing?
  
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  It sounds like you are trying to do an outright sale where your buyer finances the property outright is this correct? Tell me how you are handling the closing then I can advise you.
  
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  Please let me know, I'm anxious to find out so that I can get my first deal done and over with, being that it's always the hardest!
  
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  This really does not sound like you are trying to do a Subject To deal, so please get back so I have a better understanding.
  
  John $Cash$ Locke

• 
  tanya121519th January, 2003

  I'm sorry, I get confused with the definition of Sub-To. My plan is to get it under contract and do an "Assignment of Contract." I was going to find a buyer to assign the contract to by placing an ad, right after I get it under contract.
  
  Of course it will have an addendum attached that states: "Subject to partner's approval." Which if I'm not able to find a buyer, I will tell them my partner did not approve and get out of the contract. My fiance is my partner.
  
  3 most recent homes sold for...
  10/31/02 - $275K
  8/20/02 - $271K
  3/4/02 - $245K
  
  I will look into how long the homes in the area have been listed before they were sold.
  
  The ad I'm placing will say:
  "KICK ME IN THE HEAD, I'M DOWN!
  
  My loss is your gain. Must sell home this weekend. Price reduced $XXX. Call 123-456-7890."
  
  Am I going about this all wrong? I know everyone says to think creatively, that's what I'm attempting to do. Pease advise away...
  
  Tanya

• 
  JohnLocke19th January, 2003

  Tanya
  
  This is not my way of doing business in this great great industry, so let me give you a little advice to get you started the right way.
  
  When ever I shake hands with a person on a deal I give them my word I know my word is my bond and they will too.
  
  You are entering into a contract with a seller with the thoughts if it does not sell, then I will envoke the Subject To (your fiance) clause, this is not Subject To investing. So in essence you are not being up front with the seller in your dealings with them and are building up their hopes with the possibility of letting them down.
  
  You are new to creative real investing so you need to take stock right now on how you wish to proceed with your career, I am sure someone told you this is the way to do it.
  
  Let's look at it this way I do not want to be in a supermarket and see someone that I was less than honest with and have to duck behind the shelving before they saw me.
  
  Honesty and integrity will make you successful in the business, learn some more before you do your first deal. If you are short in the financial department there are still methods of investing to get you to the big time.
  
  Just the way this old man see's things.
  
  John $Cash$ Locke

• 
  tanya121519th January, 2003

  John,
  
  Thanks for the insight! Someone was telling how he did a deal like that, so I thought about doing it like that. I thought that was how assignment of contracts work, I guess I was mistaken. I will read up more about it.
  
  Can you suggest any other options with this property?
  
  Thanks,
  Tanya

• 
  JohnLocke19th January, 2003

  Tanya,
  
  I would Bird Dog this property for a more knowledgable investor.
  
  Sign an Independent Agent Agreement with a local investor that you can bring him a deal like this and get paid for doing it. There are many investors in your area that will pay you to bring them deals.
  
  Not a bad way to learn the business and get paid for doing it.
  
  John $Cash$ Locke

• 
  visionary22nd January, 2003

  This is one of the things I really like about this web site and the "professionals" that spend time helping us newer people.
  
  I have noticed that the successful people in this industry have ALOT of integrity and HELP people in tough situations and still make a lucrative profit.
  
  This really makes me feel GREAT about learning more and making this business into a serious and worth while career change.
  
  The more I learn about the right way to do things the more exciting this business is!!! Besides it's so nice to work with other people who you can trust and deal with!!!
  
  I have noticed that the programs for sale here are ALL real life learning experiences and not a bunch of marketing hype.
  
  Personally, it's worth studing and asking questions and to look at building a career VS. just looking to make fast quick money.
  
  THANK YOU!!!