Deal Analysis
Seller called, husband moving in one month out of state, wife would like to leave when he does.
Have a home for sale worth 150k, they owe 70k. She offered it to her son for 120k but his wife wants to build a home.
They are open to financing, but would prefer cash now.
how should i negotiate it & what should i do?
Any help given would be appreciated,
verbatim
Explore the financing options with them. If they'll carry it at 4.5% with no points, 30 years fixed, you won't beat that anywhere. Perhaps they'd do interest only.
Once they do that you've got all kinds of options.
Sounds like you have a motivated seller!
I would try to find out what the minimum amount of Cash is that they need right now, and if they're willing to take a note for the remainder.
It might help if you give them 2 or 3 options to choose from in your offer.
As long as you can live with the numbers, it will not make much difference which option they choose.
Good Luck.
[addsig]
update:
Initially the sellers said they had a home on 3 acres, with another .7 acres being bought 2 years ago for a total of 3.7 acres. Home OLD, built in 1948. New homes all around it. So After talking to the sellers, they tell me that there is a 1/2 burned church on the .7 acres!!!! According to them, they were going to rehab the building and make a business out of the building because its on a major street.
Now they gave me some appraisal from 2002 @ 100k. The comps i have on the home are at 100k today also, not including the .7 acres withthe burned church. they say the church is worth 20k and the land is worth 20k. They also hav e come to the conclusion that since the home next to them is selling for 119k there home must be worth at least 110/120k.
I havent even told them that i have 100k comps for the home now. The task of trying to convey to them that not many individuals would want to purchase a 1/2 burned church presents itself. It may have a material value of 20k but i dont know the MARKET value. If no one wants to buy it the market value is $0.
They also say the .7 acres must be bought with the 3 acres because [& i dont believe this but] of the right of way. If the home is not owned with the .7 acres - the home owner will have to get permission from the .7 acres owner to alter any natural gas/electric. Quote from the seller: the reason the other property has to go with the main property is the right of way, because we are on city utilities [sewer and gas], if u sell that house individually, then potentially u lose your right of way and any other services that u get provided, u have to get permission from the other property owner. On the .7 acres theres a 2200 sq ft unfinished building that has road frontage, that we were going to make into a business. ….it’s a old church building that burned up , concrete block walls w/ brick veneer, block walls are solid, brick wall needs some more bricks to finish it up. u can fix the building for 15-20k
With my math - the home is worth 100k & the .7 acres is worth 13/14k for a total of 114k. They only owe 70k.
If they are stuck on the 150k they are on their own. Seeing that they are moving, we'll see how it works out.
Obviously the key to these deals is motivation. If they won't budge on their price, they may not be motivated enough.
When talking/negotiating with these people, U need to win 1 of 2 things.
Price or Terms.
I would give them 140k if: I only had to Give them 70K today, and they carried the remainder on a balloon note for 10 years.
Or:
I would give them (maybe) $95-$100k Straight up. This way it is win win. Obviously these are just examples.
IMHO
after me telling the sellers i think it is worth less than they do, 120k - & the sellers telling me 150k repeatedly, And me explaining the benefits of lease optioning - they put a ad in the paper for 135k!!!!
whats up with that??