The Creative Investors Challenge...
I currently own 3 rental homes in my neighborhood in So Cal. Next door to one of them is a property that I covet. The owners are divorced. The male half is in prison forever, and the ex wife is re-married, out of state, and afraid of ex hubbies brother, who has been squatting on the property and bringing in junk cars, boats, and other assorted pack rat junk. The mortgage is paid off and they are 3 years delinquent on property taxes. I don't want to wait and buy it at auction for fair market value, and I can't buy tax certificates in my County. If it were cleaned up it would be worth about $150000. Is it possible to buy out the wifes 50% and pay the taxes, then steal the hubby's 50% by adverse possesion? Is there a better solution? This is the creative investors challenge... Who has the best solution to this deal??? I guess I could pay off both of them but I'd really hate to give money to a convict, besides, I'm a cheap bastard. Currently the squatting brother is awaiting trial, hopefully he'll be joining his brother soon. I really hate dopers.
Replies are appreciated
Bob
i am guessing from your post that the x and jailbird are still 50/50 owners. if you buy out the xw's position you will become co-owner with the jb along with all the problems ap is not an option from that position . you need make an offer to them as one. i would deal with the x first and find what she wants and go from there..........km
Josh,
AT LEAST 200 hours. I figured more, including trips to Bangor Maine, and to Joliet Illinois. I am not going to try to screw anybody, and my reputation does proceed me. This property has been abandoned by its owners and left in the hands of a free loading, drug dealing, thieving Junk collector. I can't count the times the cops, code enforcement, Fire Dept. and other agencies have responded to this place. As stated in my previous post this property is in my neighborhood, 600 feet from my home and next door to another house I own. I will be creating a win win situation when I get to clean it up and be rid of the threat to my neighborhood.
Good advise Kenmax,
I was sorta thinking along those lines. She was, and I'm sure she still is, a very nice lady. Im glad hubby wasn't successful in his murder attempt. She has indicated that she just wants to walk away from the property and enjoy her new life. I'll try to locate her and see what she thinks. I hate the idea of letting this property blight my neighborhood when it can so easily be made beautiful.
I think it pretty much comes down to clearing the title of him and get it all under her name. I would offer her $100,000 or less sub2. Give her X amount of dollars for 6 months to a year with a balloon at the end. That should give you ample time to clean it up and get it ready for resale. Of course you will need pay off the taxes and make sure the title is clean before you resell it.
Here is some chickenscratch
FMV $150,000
Purchase $100,000
Taxes ??
Monthly Payments for 1 year @ $400/month $4800
Rehab/Cleanup/Sale $5000
All this is ball park of course, but that is what I would start with. You should be able to walk out with $30,000 easy if you plan it right and she's willing to deal. Since the mortgage is paid off I am guessing she could probably care less about the property, I would start my offer really low.
Do I win?
Without getting involved in the morality of the thing here's my advice:
You say the wife just wants to walk. Let her. Give her some small consideration for her position, maybe $10,000 to $25,000, heck I'd start off offering $5,000 and the promise to be the bad guy when the brothers get pissed off for "stealing" their property. Explain that you will keep a very high profile with the bros. so that they are pissed with you not her.
So now you own an un-divided 1/2 intersest with the jailbird as your joint tenant. Next step-- get rid of him. Two possiblities present themselves:
1) find somebody the husband owes money to who has a proveable claim. Car loan, personal debt, etc. Buy the claim. Sue to collect. Get a judgement. Enforce the judgement against his 1/2 interest in the property. Many of the details of this vary from state to state and I am not particularly familiar with California civil proceedure but its not that tough.
2) Assuming that hubby paid all his bills and straightened his affairs before being carted off to the pen (highly unlikely but you never know and even if he didn't you may not be able to find a claim that you can actually enforce) and therefore #1 is not available to you then you have to generate your own claim. Begin with an eviction action to get the deadbeat brother off the property. Next pay to clean up all his junk. At this time you should have generated a sizeable chunk of bills (attnys fees, deliquent taxes, cleanup costs). At some point in the process you send a demand notice to your "partner" in this property that he needs to pay his half of these operating losses. Clearly he is in no position to pay. Now your losses become a claim against him. Proceed as in #1, judgement, attachment, clear title.
Have a few bucks (like $5,000 or $10,000) sitting around so that when your now-foreclosed partner gets out of jail and shows up at your house wanting revenge for stealing his house you can offer him some small compensation to help him get started in his new life. Make sure you get him to sign a release and quit claim as part of that transaction.
Not particularly creative-- but effective and gets you where you want to go.
Excellent Post, Commercialking
Clearly ALL the details are critical to remember! And, face it, hubby has positioned his brother in the house to make sure his Ex gets nothing, so this is even possibly karmic-justice. It sets her free without having to deal with him!
Oh, and on the moral issue, FMV-dollars are not the only currency on earth.
Good luck, Bob, you have your work cut out for you. ~~One thought, tho, please make sure you pay her at least a few bucks MORE than you give him, even if you have to send it to her later. ~~
Murder attempt?! Don't forget to set aside a little for some kevlar body armor. All kidding aside, I'm sure that you've prepared yourself to handle the druggie/jailbird mentality.
Excellent posts all !
I especially like CommercialKings approach. BTW He did square away all his affairs before he went away. So I guess I'll have to go the long way around.
CEINVESTS
Karma does dictate that she will certanly recieve the bigger half... His half will be enough to buy cigarettes in jail for years.
John_Carter
No Body Armor needed. The brothers already know who I am, and they are afraid. My bullets are bigger than theirs.
Thanx all, Now I'll be shopping for a PI to track her down...
BTW... CommercialKing wins
Aww, shucks, 'twern't nothing. . .
I'd like to thank the members of the academy, oops, wrong speach..
What about having the jailbird sell his interest.
I don't know if the lady will go for it but she could go and visit him and have him quitclaim the property to her, or sell it to you-(maybe for a carton of smokes -JK)
My point is that another option might be asking him what he will take for it-- you could let him know that you will be paying off any liens on it and if the taxes are not paid it will be confiscated by the state..-- I have heard that some notaries make a living by notarizing documents for inmates so I am sure this can be done, then if that doesn't work you could try the judjment/lien route.-- If he is willing then it might save you some time and money, adn it won't take you long to find out if he will play ball or not..
Just a thought
I guess my only problem with asking him how much he wants is that I've never been able to get through to the jailbird in a reliable fashion. Send him a letter with your phone number. He can call out, you cannot call in.