Hi Mijo
Thanks for responding so soon i really appreciate it.
a) The house is situated in southern massachusetts, and no it is not listed (at least the son-in-law did not mention this, I will have to ask)
b) The tenants say they can pay up to $2,000 per month (very high in my opinion)
c) Taxes and insurance are approximately $1,700 per year
d) When you say “gift of equity back to th buyer” do you mean seller-financing? If so, I am not sure as I have not even met the seller yet. But since he is the father in law he may consider it. the son-in-law did say though that the guy wants all cash. i guess it’s 50-50.
e) Why should I make the sales price higher?.. what is your train of thought here?
f) I don’t think it is on the market yet , but I will check. Why do you ask? is that relevant (for bargaining power?)
g) i also have not seen the house but i’ve looked at prices in the same area and this one is very cheap. Average house price is in the $270k’s, so perhaps it is not in good shape - or maybe he’s just doing his kids a favor.
Anyway, you have stirred new thoughts in my mind and I will pursue some of your questions. Perhaps i should even take a look at the house. The problem is i really don’t know what exact path to follow but you have been a tremendous help. I’d be grateful if you would continue to guide me as I have no mentor. I’m just going by what I read on creonline.
I came across a couple with 2 small kids looking for a house to buy on a lease option basis. One of their in-laws is selling his house but he wants all cash for it. They have asked me to buy the house (outright for all cash) from the in-law who is sick, then lease-option the house to them. The house is selling for approx $215k and comps are approx $250k.
Problem: I HAVE NO CASH. What I do have is a) a credit score of about 580 b)a condo worth $110,000 with no equity in it and b) a 2 family worth about $320k with equity of only $8k
Please help. This is my first serious attempt at real estate investing and i have been reading this website for the past year. Don’t you think it’s time to act???
Re: ED & OTHERS, IS THIS A HOPELESS CASE? - Posted by Mijo Alanis
Posted by Mijo Alanis on July 15, 2003 at 14:20:28:
what city is the house located in? how much can the option tenants pay in mortgage payments? what are the taxes and insurance? and do you think the sellers will do a gift of equity back to the buyer. If they will do that, then make the sales price $250 or higher if it will appraise for that. How long has it been on the market? if it appraises for 250 then have them gift back equity of 35k. and ask them to take a 2nd on the house for 15k. (interest only till new buyers can get loan). then you are at 20%ltv and then maybe someone could get you a loan. but i would really need to know what state the house is in. There are some other factors, like is the house already listed, if the sellers are going to have a real estate agent, that is going to cost them 12k+ in commissions just to do the sale at full asking price. there is alot of variables but it might just work.