L/O in bad areas - cont - Posted by Redline

Real Estate Investing
#1

Posted by Bud Branstetter on March 23, 2001 at 21:08:23:

You L/O pretty houses because you can get in lite. If you have to spend money for repairs you don’t use L/O. To much chance of problems with your cash at risk. Getting the deed, in which you control is another game. You buy if there enough equity to justify your capital expenditure. I don’t mean buying into that top 10% either. I’ve crossed out CD for both buy and sell. I also don’t feel the need to L/O either. Too easy to sell them on the Pactrust. I can do it on the low end properties too. It is just more expensive to have a third party facilitate.

I want to reinterate that its not hard to find good deals. It’s just hard getting rid of them permentately.

#2

L/O in bad areas - cont - Posted by Redline

Posted by Redline on March 23, 2001 at 18:36:31:

I’d like to continue this thread someone else posted from down below…

Seller calls me on a 2 family in a rough area. Wants to dump it, right now asking too much but I believe she’s motivated. I plan to find out how motivated she is before I waste any real time but I may be able to create some real equity in this deal. It’s got me thinking …

What’s the word on LO’s/Subject-to’s in bad areas? I figure as long as I can identify properties nearby that are owned by real people who appear to be paying their bills I should be OK. I know LeGrand always preaches L/O’s ONLY on pretty houses, but I’m thinking there’s alot of $$ to be made in these areas because I should get more motivation!

Also, is this the right order of preference? 1) Subject-to(get the deed) 2)L/O 3) Land Contract.

Thanks,
RL

#3

I will GET THE DEED. - Posted by Redline

Posted by Redline on March 24, 2001 at 10:01:10:

Thanks for the below responses …

I will check today if there really is a deal here, and if so I will get the deed and cut my risk.

Thanks again,
RL

#4

Re: L/O in bad areas - cont - Posted by JPiper

Posted by JPiper on March 24, 2001 at 01:27:15:

If you’re buying in a bad area, you should focus on getting the deed. Chances are the house will need repair, and there’s a decent chance that the seller may have some issues somewhere down the line as well (why were they living in the bad area to begin with?).

The lease/option and the contract for deed leave you open to problems. Get the deed should be the primary strategy.

JPiper

#5

Re: L/O in bad areas - cont - Posted by Carey_PA

Posted by Carey_PA on March 24, 2001 at 24:47:38:

RL,

I don’t see a problem with doing a L/O in a bad neighborhood as long as the property doesn’t need any work and you can get in light…reallll light.

You will most likely have PLENTY of callers who want to lease/option it from you. So, if you ask me, the sandwich lease option would be suitable.

BTW, I’m in the process of buying a home in a not so nice neighborhood and I already put my rent to own ad in the paper…I’ve gotten over 100 calls…3 of the callers want to buy it out right…hey I even told them I’d give them a discount if they got a mortgage instead of renting to own…wasn’t that nice of me?
I know I thought it was nice lol :slight_smile: