I Sniff a bargin, is it true? - Posted by Lisa Olivas

Real Estate Investing Real Estate Financing
#1

Posted by Lisa Olivas on January 06, 2001 at 04:40:26:

I forgot to mention that this property is in Northern Colorado. There have not been any comparable sales within the last year. However, this subdivision in which this property is located is a mile away from the downtown area. Now properties in the downtown area are incredibly inflated. We are talking about a historic district with houses built in 1912 selling for about 240K. Even the old “Railroad” houses, you know the ones less than 900sq ft., no basement, 2 bd 1 bath for about 125K.

This property is about 1100 sq ft. and again 1 mile away from the downtown prices. The property is well maintained and in good condition, built in 1944 and remodeled in 1985.

#2

I Sniff a bargin, is it true? - Posted by Lisa Olivas

Posted by Lisa Olivas on January 06, 2001 at 04:20:29:

I am a newbie at this.

What do you think of this deal that I want to propose:

single family 3 bed 1 bath, no garage
fsbo for $129,000
on market since June
owner has had several requests for her to carry the paper. She doesn’t want to carry. This home is in a lower-income neighborhood, I suspect that people with lower incomes, steady incomes but no money down are those that have asked her to carry.

Owner is retired, and has been renting the property ($850) out but doesn’t want to mess with renting. The property has been vacant for two months. Her husband has died in the last two years and I suspect that it was her husband who has managed this property.

Here’s my deal

Offer $80,000 with 1 year option with lease for $850.00 per month with power to sublease
I would sublease out at 1015, and ask first and last months rent with option to buy at $142,000. I would be looking for a couple or individual with joint or total yearly income of $45,000, with good credit, secure jobs, but no down. In addition, the city offers a zero interest loan for all first time homebuyers up to 5,000. 5% down = $7100. Assuming they can qualify they have the zero interest 5000 plus 2030 from first and last months rent held in escrow = $7030 down.

What do you think?

#3

Re: I Sniff a bargin, is it true? - Posted by Ed Garcia

Posted by Ed Garcia on January 06, 2001 at 10:38:25:

Lisa,

If your numbers are right, and the house is worth $129,000 and you can purchase it for $80,000, you buying it at 62% LTV, there’s nothing wrong with the buy.

If you don’t already own a home and have good credit, you can 100% finance it.
If you already own a home and have good credit, you can 90% finance it.

Nothing wrong with the way you want to sandwich lease/option it, except that if you’re going to find a qualified buyer with good credit to begin with? You may as well sell it to them with a 100% financing. My suggestion is to pre-qualify your prospective buyer. If you need a mortgage company to do it for you, call me.

Lisa, if and when you come to that cross road, I do 100% financing on Owner Occupied and will be glad to assist you. Yes, I can make the loan in Colorado.

Lisa, if your information is correct, and you can do what you’ve suggested you’re going to try to do? You’ve made a nice deal.

Lisa, I want to wish you Good Luck on your deal,

Ed Garcia