Is this realistic while trying to owner finance - Posted by Tarun_md

Posted by Kate (VA) on January 18, 2001 at 15:53:00:

You may want to read the thread ‘Subject To Gone Bad’ started by Tim Jensen before you consider selling it subject to when that is the way you bought it. Tim has a pretty sticky situation on his hands from doing just that.

Good luck,

Is this realistic while trying to owner finance - Posted by Tarun_md

Posted by Tarun_md on January 18, 2001 at 11:47:16:

I just took a property subject to.
House is worth 130k
If I try to sell this house owner financed, is it realistic for me to expect at least 5k down from the buyer, ESPECIALLY when this house needs $1k-$1.5k worth of work.
The carpet needs to be thoroughly cleaned. 3 bedrooms and the living room walls need to be painted. Kitchen is filthy. Kitchen tiles, kitchen cabinets need to be cleaned. The bathroom sinks are filthy and the the house smells like cat urine.
However, It can be a nice house once fixed. Everthing in the house works great.
I do NOT want to put ANY money into this deal because it has no equity and the seller is 3 payments behind. I need at least 3500 right now just to make up the backpayments. Anything above that would “hopefully” be mine to keep.

My cat(&dog) urine remedy - Posted by Newbie

Posted by Newbie on January 19, 2001 at 08:20:26:

I have had this problem before in my own house and my rental townhouse. Go to Petsmart and buy a big jug of either Simple Solution or Nature’s Miracle. These are enzymes which remove odors(not stains) from urine, vomit or feces. I think its about $20 for a gallon of it. Treat the affected areas by just pouring the stuff on and soaking the entire spot(s) where the urine was. If you can’t see where the urine was, buy a blacklight. It will reveal the spots to you in a dark or dim room. It may take a few days to dry(make sure it is well ventilated), and while it dries it will still stink. It may also take a second dousing to entirely kill the smell. This works though - I swear it does. It’s a cheaper alternative to replacing the carpet and padding. My exp. with rentals has been that vinyl tile or Pergo floors are way better than W/W carpet. Area rugs are cheap and disposable! If you have to rip out carpet, consider one of these floors as a replacement. Best of luck to you.


Re: Is this realistic while trying to owner … - Posted by SCook85

Posted by SCook85 on January 19, 2001 at 06:56:38:

Get the home cleaned up! Whether you do it or pay someone it will make life much easier for you. Even if you don’t paint the home, just do a thorough cleaning.

This reminds me of some guys who I knew that made money at car auctions. They would go to auctions and buy the dirtiest cars and get them really cheap, they had a shop right near the auction that they dropped the cars off, had them detailed and brought the cars right back to the auction for the next week. They would sell the cars on average for a $1,000 more then what they bought them for a week before.


Do not get lazy Tarun - Posted by Jim IL

Posted by Jim IL on January 18, 2001 at 20:56:47:

My brother, don’t get lazy on us now.
This could be a decent deal, especially since you have the out of letting the home go.
I’d do two things right away with this one if I were you.
First, call the lender and verify ALL the info you have. IF the numbers are right, then goto the next thing.
While you are talking to the lender, see if they would do a short sale.
Then, you can perhaps sell it to a qualified buyer retail with a loan. You may be able to get the balance down and create some equity for you to get out of it.

But, if the lender will play ball or not, get this place cleaned up.
You are young, and should be able to do the work yourself.
Goto the local dollar or discount store and spend $30 on cleaning supplies.
Clean the mess up in the whole house.
Scrub like a madman.
While at the dollar store, get a bottle of white Vinegar and several of thise Glade Plug ins with inserts. Use the vinegar to scrub the worst cat urine spots, it kills some (not all) of the odor.
Then, rent yourself a rug doctor for a day, (under $50 usually) and clean the carpets.
After they appear to be clean, you will STILL have the cat smell, maybe a bit worse until the carpet dries all the way.
Now, spread some carpet deorderizer on the carpet and do not vaccum it up, leave it there.
Then place those Glade Plug ins all over the house, and put more than one in the rooms that smell the worst.
Next, paint the rooms that need it.
You can do this yourself and save labor at least.
And, if you goto a few different paint stores, you can surely find free or really cheap paint, in the form of “Mis-tints”.
Most stores either give it away or sell it for $.10 on the dollar.
Who cares what color it is, it is free.
Just get decent colors, not BRIGHT obnoxious colors.
And clean up the yard if it needs it.
Now the home will show better and you can sell it however you want to.
I’d never leave a home this messed up and try to sell it.
It is cheap enough to overcome.
You may also want to E-mail Rick(CA) below and ask him about the air cleaner he mentions in his post.
I know to what he refers, and have one myself.
This machine seems to get the odors out of many homes I have done, as well as mold, midlew and other things.

After the place is cleaned up you can then incorporate some of the ideas already given to help sell this.
And lastly, market this place like mad.
Call mortgage brokers and tell them about it.
You may tell them that you are willing to finance it now for someone they have who cannot get a loan just yet, but can soon.
Then just promise to send the buyer back to them for a refi later.

And Tarun, DO NOT assign the beneficial interest in the trust over to a new buyer and walk away without geting a good release from the seller first.
Take a look at the mess that Tim Jensen is facing now, and avoid being in the same position.
I sure do not envy him, and you can be smarter than that, thanks to him sharing this here on CRE.

Good luck Tarun, have a drink for me in Atlanta,
Jim IL

P.S. Something else you may try that has worked for me with homes that have an odor problem.
When people call and want to see the home, schedule multiple showings. Schedule several people to show up at one time, and then get there 30 minutes early.
When you arrive, take with you a pan, an apple or two, some cinnimon (sp?) and maybe an orange.
Put all this together in the pot on the stove with water and boil it.
It will give the whole house a nice smell that may remind some of Grandmas cooking and baking.
It will also help to cover any odors you may still have in the home.
I learned this trick from a RE agent, she does this with ALL her open houses, and it does seem to work.

Re: Is this realistic while trying to - Posted by dewCO

Posted by dewCO on January 18, 2001 at 20:34:38:

You’re going to need to seal the subfloor with shellac or something like that. Just pulling the carpet out will NOT cut it. It depend son what kind of deal they’re getting all the way around (price, down, interest rate, etc.) and how tight the market is for buyers where you are, as to how much they’ll put up with to get in.

Do you know that this loan can be reinstated by paying what it owed and by starting to make all the payments on time, now??? Some lenders won’t take anything other than what they are owed, when the owner has fallen behind, in which case it would make it hard to resell this to someone else while keeping the existing loan in place.

I’d… - Posted by David Alexander

Posted by David Alexander on January 18, 2001 at 16:31:57:

Yank the carpet out and show the house with bare floors, that is if it’s a slab foundation.

I would then find out how much it would cost me to get carpet installed. Then add that to the amount down your asking for. For instance if it will cost you another $1500 to carpet then ask for $6500 down and let them pick the color.

David Alexander

P.S. It seems the last 4 houses I have bought have all had the cat urine problem and it hard to get people past it. Even shampooing the carpets doesnt work, because it’s generally down into the pad.

Get The Place Cleaned Up 1st - Posted by phil fernandez

Posted by phil fernandez on January 18, 2001 at 14:58:54:

I totally agree with JohnBoy. Get the darn place cleaned up and smelling nice. Cat urine will turn anybody off. Spend your money now on cleaning or spend you money later on holding costs.

Is this realistic while trying to owner finance - Posted by JohnBoy

Posted by JohnBoy on January 18, 2001 at 12:54:42:


Go in and just CLEAN the place up! That shouldn’t cost but a few bucks to buy some cleaning supplies! I would even spring the $50 for some paint and paint the rooms. The NICER you get the place to show, the easier it will be to get it SOLD!

After you clean the place up and at least vaccum up the carpet so it doesn’t look like a pig pen, then offer the buyers their CHOICE of color for new carpet. YOU go down and pick out some affordable carpet and get some samples of the colors available. Get the carpet place to give you an estimate for new carpet with padding plus installation. Pick out something inexpensive that can get the job done for $2k or less. Then offer the place for $10k down with YOU buying the carpet for them. Once you get their money then order the carpet. The reason you didn’t just go ahead and replace the carpet now is because you thought the buyers would like to have the option of picking their own colors!

If the buyers are short of $10k to put down, now you can offer them a choice! $10k down and YOU will buy them the new carpeting OR, if they prefer, they can take the place “as is” and you will knock $2k off the selling price and they can get in with only $8k down! Now the buyers get a choice! Just add the $2k to the purchase price. Either way you come out OK because the buyer is paying for it one way or another.

But get the place CLEANED UP! A day of elbow grease will help with getting the place SOLD!

Question - Posted by Charity

Posted by Charity on January 18, 2001 at 12:08:08:

Are you getting monthly spread on it? Where is the profit on this one if you have to pay $3500 in back payments and it needs work? just curious what the exit strategy is.


Even better… - Posted by Ben (FL)

Posted by Ben (FL) on January 19, 2001 at 16:21:10:

we used Ex-Stink on an apartment in a duplex we bought where the tenant had cats for 14 years. When we pulled the carpet out, it was dripping. The cats sprayed on the walls and the urine soaked into the drywall. Oil-based Kilz on the walls, and sprinkle Ex_Stink on the floors got rid of it all. Ex-Stink is a powder that consists of very small, porous particle that “scrub” the air. It also comes in gravel form in bags that you can place in the clean-air return to the ventilation system. we found it on the internet, and it was very reasonably priced.

Re: My cat(&dog) urine remedy - Posted by David Alexander

Posted by David Alexander on January 19, 2001 at 14:19:07:

Sounds like a deal… I think I might have my guys try that… Blacklight interesting??

David Alexander

D a m n… :slight_smile: - Posted by David Alexander

Posted by David Alexander on January 19, 2001 at 24:28:08:

that’s alot of work… ant time to boot.

One phone call and my guy could be out there ripping out the carpet, samples there for people to pick from and changing the carpet at there expense (the buyers) once the deal is inked and money has changed hands.

David Alexander

Re: I’d… - Posted by Rick(CA)

Posted by Rick(CA) on January 18, 2001 at 18:03:36:

There is a solution to the odor from pets and cat urine. It’s an air purification unit. Feel free to email me offline if you’d like more information. It’s been demonstrated to work time and again and not just for that.

My exit strategy - Posted by Tarun_md

Posted by Tarun_md on January 18, 2001 at 15:33:42:

He deeded me the house subject to. I told him that I WILL NOT MAKE UP ANY PAYMENTS OR START MAKING HIS PAYMENTS UNTIL I GET IT SOLD. If I can’t sell it, I will let the house go into foreclosure and the seller understands it. He could care less.
As to my exit strategy, I have a couple in mind. I could get enough down from the buyer and make up the payments. Piti is 1143 on a 7.5%loan. If I do a wrap and sell at 10% interest, thats a good cash flow. Or I could l/o it and get at least 1375/mo. Or I could just deed it to someone else and take back a second and collect payments on that.
As you can see, once you have the deed on a house, you have many options available to you.