Help Figuring Out Bid Fast Please
7 yr old bilevel- ARV 155-160k
10-15k repairs
It sits on 4.5 acres which is subdividable at this point, 2- 2.25 acre lots. 1 with house above and 1 vacant valued 28k
How would you bid this??
Asking price is $129k
Please someone respond.
Thanks in advance for the assist.
Barbann [ Edited by Barbann on Date 08/09/2004 ]
The first thing that I find out is what the seller owes, figuring that all the equity is negotiable. Depending on the situation and needs of the seller I try to find the best deal for me that will work for them. That said, one thing (of many) comes to mind. You might try to to get them to accept a land contract, with the lowest possible monthly payments (usually whatever their payments are, if they have a mortgage) with a balloon due sometime in the future. If you could make that happen I would do three things simultaneously.
1. I would get a renter or Lease Optionee into the house. You could do a work for equity deal with a buyer or spend some money to get it livable, if it needs it.
2. I would divide the property and put the extra lot up for sale.
3. I would be getting a loan package together to buy the propery using the proceeds from the sale of the lot as a down payment.
If you were able to sell the lot and close on the house soon, you may be in a position to negotiate a discount from the seller to pay off the Land Contract sooner than they were expecting.
Of course there are other ways to do a deal like this depending on everyones situation. I'm just trying to excercise my creative mind here.
Good luck.
[addsig]
Swetbak,
Thanks for the advice. The house has already been foreclosed on and is bank owned. Being subdividable is not common knowledge. I am willing to pay cash, just need some back up on paying the full asking price.
Respectfully,
Barbann[ Edited by Barbann on Date 08/09/2004 ]
OK Barbann,
If I was going to pay full price on an REO, I would ask them to finance and give you back the 10-15k needed for repairs at closing. If they won't finance for you I would subtract the repair costs from their asking price. I'm sure they have it discounted for repairs (in their mind), but it is a drag on their financials and depending on the market were the home is located, they might still be willing to negotiate price or terms.
It's not a screaming deal so I wouldn't be too quick to take the full sale price.
[addsig]
I agree with Swetbak, that deal doesnt have such a great spread. Especially, if you are going to cash out the bank from an REO. See if they will take $25K less than asking price...or www.more.If they agree to finance the purchase and repairs, thats another matter.
I would really be interested to know when was the last time someone had a bank finace buying an REO from them and the repairs. In my experience they laugh at you and tell you to come back when you are serious. Maybe this is working in other parts of the country?