Need Advice On Flipping
I have a sf home under contract for $143,000. FMV is 165,000 - 175,000. I'm currently in the process of getting a mortage on it. I have run some for rent and rent to own test ads without much success. I'm now considering flipping it. I do not have any buyers currently lined up. Closing will probably be at the end of January. Any advice on how to proceed?
You need to say something or do something to attract investors. Cash at closing is an option.
Find a local REI club around you and present your offer... Also - try to do a lease option instead of renting it out. This will probably get you more of a response to just renting...
Good Luck!
[addsig]
Where have you advertised?
What did your ad say?
How long did you run the ads?
Do you have a sign in the yard?
How about directional signs to the property?
I'm not sure what you have tried so it is hard to tell you what to try next.
If you are planning to flip, you may want to try to get your mortgage broker to raise your interest rate and pay for your closing costs. The extra interest cost will be a lot cheaper than the several thousand dollar closing costs.
GOOD LUCK
Where have you advertised? Local newspapers
What did your ad say? One ad For Rent, one Rent to Own
How long did you run the ads? 2 Weeks
Do you have a sign in the yard? Not yet, I haven't closed on it yet, so the current owners are still in there. They said it would be ok to put up a for rent sign
How about directional signs to the property? No.
My original intent was to rent to own, I did not get many calls for the ads in the local newspaper. I did show it to a couple prospects. The sellers have given me permission to show to potential tenants. I'm concerned if they know I'm now thinking of flipping it, they will get concerned they sold too low and get cold feet.
I'm trying to decide if I should continue to try and lease option, try to wholesale, or close on it and try and sell FSBO. Any other advice would be greatly appreciated.
Your rent-to-own newspaper ads should contain sales verbage that will attract the right type of customer. Put one or more of these heading, in bold, over your ads.
STOP PAYING RENT.
DAMAGED CREDIT OK.
LOW DOWN PAYMENT.
DOWN PAYMENT ASSISTANCE PROVIDED.
OWNER FINANCING.
NO BANKS REQUIRED.
A sample ad:
OWNER WILL FINANCE! Low downpayment, lease to own this nice 3 bedroom house in a great neighborhood. Good job more important than past credit problems. Stop renting, start owning!
Call John Doe at 555-1212. Let's talk!
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Now, of course, when you attract bad credit customers and owner finance, you must insist on SOME sort of down payment so they have skin in the game. You could also let them make improvements (sweat equity) in lieu of cash. Just get it in writing.
FYI, I nearly lost everything a few years ago (9/11) and bought an owner-financed house with a 480 credit score. I worked hard, turned my biz around and fixed up the house, closed on it and cashed out $30K.
Don't assume a guy with bad credit is a bad guy...look at the big picture.
Thanks for the help and ideas!