Bankruptcy tapdance - Posted by rm
Posted by rm on October 15, 2003 at 10:34:13:
Met with seller this morning.
He retired two years ago, lost his entire IRA.
I didn’t ask how.
His current income is $800/mo.
He has outstanding non-secured debt of $16k.
Owes the IRS $3500. No lien on property yet.
His first is $55k at 7%.
The second is $23k.
ARV is at least $140.
House needs $30k in repairs— probably less. The house is GROSS inside- dogs___ EVERYWHERE, the smell of pet (human?) urine and smoke in the air, trash piled high in every room.
I need to go get my shots updated.
It’s a beautiful rehab candidate.
Another investor/broker (whom he doesn’t trust) offered him $7500.
He said, “If someone wrote me a check for 30 grand, I’d move today.”
I told him I might be able to do just a -little- better than the other offer, but he’d have to wait until I was done for a portion of it.
He doesn’t care about his credit at this point.
I’d really like to short the second and re-instate that first- I really like that interest rate.
He’s probably going to file Ch 7, but he was told that he can’t until he sells his house. However, there really isn’t sufficient equity in the house to pay him anything until the second is hammered down, due to its condition.
He’s going to need some help in order to find a place to live. I was going to, rather than give him the money directly, pay six months’ rent (or whatever is required) directly to landlord/apt. manager and to a storage facility for his stuff.
What I’m wondering is this: How can I structure this deal so I can give him some back-end money after I’ve sold it without complicating his bankruptcy proceedings?