Comps in non-disclosure state - Posted by green

import · January 15, 2001, 1:52am

Posted by Green on January 17, 2001 at 13:37:20:

Of course you are both right ,and I shall follow your advise.

import · January 15, 2001, 1:52am

Posted by green on January 15, 2001 at 02:52:57:

I am trying to obtain a hard money loan.I need to come up with comps .I live in a non-disclosure state, about 5 hrs. from property.It is a former motel that has been used for other purposes in recent years.No other motels exist in town.The owner states that other motels in the area charge $50-$100 a night during hunting season.How do I proceed without shelling out for an appraisal(short on funds)?

import · January 15, 2001, 9:23am

Re: Comps in non-disclosure state - Posted by Ed Garcia

Posted by Ed Garcia on January 15, 2001 at 10:23:00:

Green,

I’m afraid you’ve got a problem here that can only be solved by an appraiser. From the way you’ve described the deal, even the appraiser will have their work cut out for them. The reason I say that is because, I’m not sure whatever formula of comps you come up with, the lender will consider. I think the lender is going to want an appraisal period.

This property is a nonconforming property that was a motel, and obviously didn’t make it as a motel, or they wouldn’t have changed the use of the property. Green, I think that if you’re serious about purchasing this property, you should spring for an appraisal to not only get a professional evaluation, but to learn the best possible use for the property.

You don’t really know what this property is worth so how can you buy it? I think your just dreaming of what can be done with the property, but don’t have the experience to know for sure. That’s all the more reason to appraise the property.

I’m sorry that I didn’t tell you what you want to hear, but you should consider what I’ve said.

Ed Garcia

import · January 16, 2001, 3:44am

Re: Comps in non-disclosure state - Posted by green

Posted by green on January 16, 2001 at 04:44:56:

Thanks for your advice!I’m pretty sure it didn’t make it as a motel because it only has 1 bathroom to each floor.However it is located at intersection between 2 major highways,so I think there’s potential.At only $20,00 I think its worth investing in.It also qualifies as an historical landmark,so I could get funds from the state.Would I be better off seeking residential financing?If so how would I go about comping that?I have no problem getting an appraisal after I get a contract,but the owner wants cash and has had another offer so I want to make sure I can do it before investing money.

import · January 16, 2001, 8:20pm

Re: Comps in non-disclosure state - Posted by Nate

Posted by Nate on January 16, 2001 at 21:20:17:

I don’t mean to be rude, but I really think you need to go back and read Ed’s post again. Maybe a couple of times, until it really sinks in. I think he gave you sound advice, and based on your response I do not think you “got it”.

The fact that the property is selling for only $20,000 does not make it a great deal. Perhaps it is worthless. An income producing property has no value if it can’t produce income. This property is apparently useless as a motel (we all agree on that) and you haven’t come up with an alternative income-producing use. Instead of worrying about how to finance the deal, or how to get into the deal with no money down, or how to tie up the property without an appraisal, why not take a step back and think about what your plan for the property is. If you don’t have one, stop right there and don’t go any further.

Good luck.

Nate