Posted by Katy-Tx on March 07, 2002 at 15:54:35:
Hey Lyal,
David and I are actually good friends. He had already given me a couple of names that haven’t really worked out.
Did I make a huge mistake? - Posted by Katy-Tx
Posted by Katy-Tx on March 07, 2002 at 11:47:26:
I was hoping maybe y’all could help me. Please tell me if this is a good deal for someone since I am having trouble finding investors to deal with. I am not sure if I am seeing this wrong or something.
Here is the situation:
I acquired a house subject to a few months ago.
The house was bought in 2000 for 47K. First lien is 42K. Second is 5K. I paid off the second lien for $500 which was nice. I thought the deal would basically end there and I would continue to make make payments on the first as soon as I found a buyer.
I was able to have the first lien holder payoff 2 years of taxes before I agreed to make a payment. Then, thankfully, I found a buyer with decent credit (not great- 562) that has bought in on a lease option for 58K. He has paid 1K option consideration and will pay $615/mo in rent. The amount of rent discount is up to me and will depend on how long he wants to take to refinance-- how badly I need him to, basically.
So the first lien holder actually offers to look at a payoff offer if we had one. We come back with 30. They accept it immediately. Nice, but should have gone lower–next time. So I actually do get an investor in place to fund 32. Unfortunately, the appraisal we ordered for him only comes out to 42. He wants to back out but instead we get him to agree to 22. We then go back to first lien holders and get them to agree to 27- after the first offer! (You’d think I would have learned by now!) Great. No problem. I can find someone with 5 finish it out.
The snag is that all of this was going on last week and the foreclosure date was set for Tuesday. This was the time frame from the start. Unfortunately, the lawyer demanded a survey among other things on Friday despite the fact that we had offered to get him one from the beginning and he turned us down saying it wasn’t necessary. There was nothing in the title commitment saying it was necessary either. So are deal is getting precarious, now.
Finally at the 11th hour I was able to get my dad and boyfriend to agree to put up the 27K with the condition that they need to money back in 2-3 weeks max.
So my question is this: is this a good deal for note buyer to put up 30k on a 30 year note (but could still afford it on a 10 year) with a 4 year balloon at 15%?
Am I way off track and have made an awful mistake?
Any insight would be appreciated.
Thank you,
Katy
Re: Did I make a huge mistake? - Posted by Terry (Houston)
Posted by Terry (Houston) on March 07, 2002 at 14:39:33:
Where in Texas are you Katy?
Terry (Houston)
Re: Did I make a huge mistake? - Posted by Tim Jensen
Posted by Tim Jensen on March 07, 2002 at 14:08:34:
Katy,
I would try posting this info on the notes forumn.
However, here is another idea. Since Dad and BF want their money back, why don’t you partner with Dad. Have him get a loan to get his money back. That will give you time to sell the place. You will get cashflow while you are preparing your buyer to purchase the place.
Tim
Re: Did I make a huge mistake? - Posted by lyal
Posted by lyal on March 07, 2002 at 13:15:56:
Katy,
Where in Texas are you? You might want to drop a note to David Alexander who posts on this board.
All the best, Lyal
One more thing… - Posted by Katy-Tx
Posted by Katy-Tx on March 07, 2002 at 11:48:54:
Do y’all have any suggestions on where I can find investors that would do this sort of deal besides just basic networking and calling everyone I know?
Thnaks,
Katy
Re: Did I make a huge mistake? - Posted by Katy-Tx
Posted by Katy-Tx on March 07, 2002 at 15:52:53:
Hey Terry,
I am in Dallas.
Re: Did I make a huge mistake? - Posted by Katy-Tx
Posted by Katy-Tx on March 07, 2002 at 15:52:11:
That might be a possibility except that 1) timeline would not work and 2) they don’t really want to be in the deal. My last case scenario is a (somewhat expensive) hard money loan for 2 years if I can get it but I’ll take any time frame just to buy me some more time so I can shop for an investor.