Re: HELP!!! First Week, First Deal ,in New Jersey - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on July 01, 2002 at 14:47:53:
J and J---------------
It sounds like you have a “live one” here.
However, iIt is hard to advise you, due to a lack of some important information.
What would be your intention if you do get a deed to the property? Move into it for your own home? Sell it quickly to a real estate fixer-upper investor? Fix it up and resell to an owner-occupant buyer?
How long does it take to do a foreclosure in your state? Has the foreclosure process started for the first loan? If so, how far are they from losing the property?
Even if the foreclosure sale were scheduled for soon, you could probably do a “wholesale flip,” whereby you get a fixer-upper investor to buy the property from you. You price it low to attract a right-now, all-cash type buyer. The buyer could just catch up the back mortage payments, and perhaps the back taxes, take the property over subject to the existing loans, then fix and resale the property.
You could do something similar yourself, if you have the resources to pay the mortgage delinquency and pay for the repair work. It probably will not be necessary to pay the back taxes, unless they have been unpaid for several years and a delinquent tax auction is eminent.
The property does not sound like a good candidate for a longer-term hold rental property. Too valuable, and probably could not command enough rent to pay for itself.
There is a technique called lease with option to buy. Once you have the deed, it might be possible to pass the house on to a new occupant/renter/future homeowner with this deed. The issue is the amount of monthly payment. It might be too expensive a house to allow you to hold it for a few years, with the optionees/leasees paying you a premium rent. That would depend upon what the property would rent for without any option.
You don’t say where you are, so it is hard to know if a property of this value will sell soon or would take many months to sell. Here in Northern California, where I live, the market for properties in that price range is very hot, and it would sell soon. In other parts of the country that is a very expensive house, with few buyers in that price-range, thus very hard to sell.
Please, do not believe that “appraisal” from 2001 as being accurate. Never believe an appraisal you get from a seller. Appraisals are opinions of value and the indicated values can be greatly influenced by who the person is requesting the appraisal, the money paid to the appraiser, the reason for the appraisal, etc.
You need to know the value by checking comparable sales in the area or by having several real estate agents in to see the house and give you their opinions of the value, or pay for your own appraisal by an appraiser that you believe to be honest.
It would be good to get a contract to buy the property, with the right to close about the beginning of September or earlier. The contract also should allow you to withdraw should your inspections of the property cause you to think that it is not a good enough deal for your to buy. This might be an excellent purchase.
Good Investing***********Ron Starr*************