Is This A Valid Deal?

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

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!

Add Comment

Login To Comment