Is This A Valid Deal?

Comments(4)

• 
  Ruman14th November, 2004

  Nothing too fantastic here of a deal... you say FMV is $200k, what is it listed for right now? It has been unable to sell so I'm assuming it's listed for $220ish? The only reason to hold this would be for appreciation but the basically negative cash flow would really hurt this deal. If this is your first I would try to go for something with more cash flow, at least.
  
  
  Quote:
  On 2004-11-14 13:01, BigDaddy2 wrote:
  My first deal, and want your opinion.
  A friend has a nice house in NE Atlanta and has had it on the market and just wants out of it bad. I want to be a problem solver and help him out.
  
  FMV - 200k
  Loan Balance - 178k
  Mo Pmt - 1280 (PITI)
  
  Comp Rentals - 1300
  
  Is there anything here to work with?
  If so, how would you structure it?
  Thanks, Jimmy

• 
  InActive_Account14th November, 2004

  It doesn't look like a bad deal to me. How much would you be giving him for this property. If you are just going to take over payments. CFD or lease option it for 200,000.

• 
  myfrogger14th November, 2004

  Yup yup yup...sounds like a workable deal! Do you know about buying subject to? Thats what you should do here.
  
  My guess is the interest rate is about 5.25%! Is that an arm or fixed? You should check into that.
  
  But what you can do is sell on contract for deed under the following terms:
  $220k sales price
  3% down ($6600)
  $213,400 financed at 7.9%, 30 year amort, payments of $1551+estimated 300 tax/insurance = $1851 PITI payments for your buyers
  
  Sooo assuming you pay nothing to the seller this is your profit:
  $6600 down
  $571/mo cashflow
  $35k approx backend
  
  If you sell with a 30 month balloon your total estimated profit is $58,700!!
  
  Of course you know your market better than I do. Is the place worth $220k? In my area I try to sell for the high end of market value plus 1 years appreciation.
  
  Can you swing a 7.9% interest rate? I would assume so...thats a very nice rate for people. You may even be able to get more than 3% down.
  
  Regardless, this is something worth looking into.
  
  GOOD LUCK

• 
  BigDaddy214th November, 2004

  Thanks for the help!