Please Help With Structuring The Deal!
Please help me structure the deal. I am completely new to this but I was following board for a few years.. I ran into potential deal. Please let me know if it’s workable and what’s the best way to proceed.
SFH in NY State 2 acres
Preforeclosure.. tax sale scheduled for Aug 29
Payoff on mortgage 267K
Owner will be happy with 100K to walk out
House is in a good condition but the owner is in construction bus and almost finished 6-lot garage.. driveway needs to be paved. He made it as an addition to the house with garage and extra two units on top that he was renting out. The rooms are completed.. only garage needs to be finished. Estimated cost of finishing garage and driveway is about 25-30K. It can be done in a month or less.
After it’s done FMV should be around 575-600K
To sum it up:
Payoff – 267K
Owner payoff – 100k (may agree to less)
Repair cost – 30K (I would add 10k to pretty it up before sale)
FMV – 575K (to be on conservative side)
I want to turn it around and sell asap. Also, 1 acre can be sold separately for around 100K (it’s already been approved to build another house there).
I am really a little lost here. My credit is pretty bad and I can get a loan through conventional means (I am also stated). I would also need some cashout in order to finish garage.. So we are looking at 75LTV or so (I also consider of making a contract with the owner of maybe giving him 50k when buying and the rest after it’s sold). What’
S the best route here to go? Please advice. I think HMLs loan up to 65-70LTV only.
Thanks a lot! I would really appreciate any recommendations.
How much does he owe in taxes? Is this an actual foreclosure or a tax certificate sale for the unpaid taxes?
are you looking for properties in foreclosure or reos?
Actually, both.
Go to the courthouse. They are free and always fresh.
WINGNUT - I just tried the site you recommened and am not impressed.
There are ZERO reliable sources for foreclosures. Realtytrac is particularly bad. They still have a home listed under their FSBO listings that sold in 12/2004! Save your money and do your own research.
Da Wiz
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The Arthur Schopenhauer?
The Wiz is right. I pay around $1k per year each for 3 different local foreclosure info sites, do a bunch of comparisons, use the Clerk of Courts sites extensively, etc., and spend a lot of time researching and tracking down the deal.
Every couple of months my personal research will uncover a sleeper deal that others do not see... like buying a 12 acre farm at the Courthouse for $183K and selling it within 15 days for $300K, without touching the doorknob. Not bad for a recent flip, huh?
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PGR,
Was there some course that you and others took recently and somewhere they offered you something to post on discussion boards? Maybe they said you would be the first one to get paid when some money comes in?
Is money running low to pay off the last investors who got involved and to keep the pyramid going you need new investors?
You do not have to answer, everyone knows the answer.
John $Cash$ Locke
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Was that Pathetic Group Representative? Some spammers are pretty slick -- these guys are in preschool.
Wiz
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Thanks Egbenj for your reply.
I figured that might be the reason they asked for the receipts , because of the difference in the price we bought for and the selling price.
The appraiser has been out and he took pictures when he was there of the improvements.
There is only about a 20k profit in the deal, but I guess they need proof.
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RBJJ,
I just closed on a flip that needed the same information (since it was less than 180 days and such a big profit (about $30,000 on a house that sold for $83,900).
My agent simply had me compile a list of repairs and upgrades with estimated costs involved.
Plain and simple nothing fancy. Mortgage co. accepted this without question.
Best of luck
Dr D[ Edited by drdanger on Date 08/09/2006 ]
Correct as previously stated. The preliminary HUD1 must materially match the final HUD1. In most cases the seller may not reecive a nickel from proceeds.
The Purchaser may, via separate contract, agree to purchase some personal items for cash... or pay for a seller performed service such as leaving the home in broom swept condition, or trash removal, etc.
This must be done outside the scope of the contract of sale.