How well should I screen buyers with bad credit? - Posted by Debra G.-VA
Posted by Debra G.-VA on May 23, 2000 at 08:34:07:
I have a potential buyer for a 1983 home that needs some work - worth $8,500 fixed up, maybe $5,500 as is. Will have $2,500 invested in it, before fixing. This buyer is willing to buy AS IS (great plus, in my book!) as he has the construction skills to work on it. They have $1,000 down payment. Currently living with family, so they don’t have a rental reference. They say wife has medical bills and court costs on her credit, and he has an old student loan.
Should I still check their credit report, to make sure they are not professional deadbeats? Some of you folks say that you don’t care what the buyer’s credit is if they put at least $1,000 down. I would make at least 150% yield on this deal, if it goes through OK.
So far, I’ve preferred to finance buyers with good rental references, even if they have no credit. The park management had previously approved them for a park rental, but they didn’t take it as the home was in bad shape for the amount of rent they were charging (which I’ve heard other renters say about the same park).
Any suggestions? Thanks!