Made first call...need advice please!! - Posted by Jerry

Real Estate Investing
1

Posted by Jim IL on April 18, 2000 at 20:51:56:

Jerry,
First, Congrats, you made a call. That is the first hurdle for most, and you cleared it.
Now, after reading what you provided, I can only come up with this.
You need more info!

When do they move out of state?
What do they NEED for cash? (they will all say at first, “we need all our equity”)

And, whatever else you can get from them.
Once you know the true NEEDS of the seller, then you can decide whether or not you can provide those needs and STILL make a profit!

Sounds simple, and I know it is not always the case.
But, ask a bunch of questions, make them open ended, and let the seller talk the most.

Then , present them with a few offers, and let them pick the best one for them. Just make sure they all work for you.

Hope that helps,
Jim IL

P.S. Where are you located? If you are near me, feel free to e-mail me for my number and I’d be happy to help you with the deal, for my usual fee of course…a few beers! Õ¿Õ

2

Made first call…need advice please!! - Posted by Jerry

Posted by Jerry on April 18, 2000 at 19:44:58:

Well, I finally made the first call on a property. These are the details:

-single family home
-asking 103,000
-owes 49,000 on non-assumable mortgage
-3bed, 1 bath
-detached garage
-no central air
-1040 square ft.
-need to move out of state; new job

This is where I need help. They have a lot of equity, and they say that they are pretty firm on needing all of their cash at closing since they are moving; they are not willing to hold a note or lease option.

I know that there has to be some options available to me as a buyer to work things out “win/win” as everyone says. Any ideas?

Thanks in advance for your help!!

Jerry
(newbie-in-training)

3

Re: Made first call…need advice please!! - Posted by Patti -FL

Posted by Patti -FL on April 19, 2000 at 12:48:28:

How can you get comps on a property? I have two houses I would like to make an offer on. One is in my neighborhood, that I use to rent for $525 month and before my lease was up he had offered it to me L/O ($47000) but this is not the type of house I would have wanted to invest long term in. The other is an abandoned house in a n’hood in the market of $35000- 55000 and this is off of the city appraiser’s listing of the areal houses, it is not for sale but the neighbor told me that the owner tried to rent it and no one would because it has a hole in the bathroom. I have also line up two players on my team for financing a quick flip but I might consider keeping one for renting. What do you think?

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Re: Made first call…need advice please!! - Posted by eric

Posted by eric on April 18, 2000 at 21:57:59:

-asking 103,000
Ok, but what is it worth? How do the comps look? If it’s worth 150k, this is a good deal. If it’s worth 100, which I suspect is a lot closer to reality, then it’s not. It troubles me that the seller isn’t willing to talk about creative financing. Is he willing to be flexible on price then? If he’s flexible on neither price nor terms, then he is what we call an unmotivated seller, or a timewaster. Great job makin’ the call, but you probably have about 99 more to go before you find a deal. It’s a hard lesson: - NEVER, EVER, deal with an unmotivated seller. Period. No exceptions. Take it from someone who has wasted a LOT of time coming up with creative offers, that solved everyone’s problems, only to have them rejected. Not countered, mind you - Rejected. Since the seller is moving, and looking at double payments, he has every reason in the world to be motivated - but just because he has reason to be, doesn’t mean he IS. I just walked away from a deal, in fact, where I was offering FULL MARKET VALUE, per appraisal, new financing. (It was for a residence, not an investment.) I was going to cash them out for 160,000 dollars, just becuause I liked the neighborhood so much. A home inspection revealed that the roof was shot. I live in Florida. That’s ok, it’s really hot here, roofs rot all the time. But they refused to replace it for $4500, instead they wanted to “re-roof” it for about half that price. Since I was basically offering full price, cash, (once again, this was for living, not investment), I basically told them to kiss my you-know-what. Fix the roof, and do it right, or say goodbye to $160,000 dollars, cash. They walked, over a $2000 difference in a repair bill. No one could believe it - not my agent, not the listing agent, not the mortgage broker, not the home inspector. I believed it. Because I know, to never, ever, deal with an unmotivated seller. BTW, I am now looking at buying a brand new home, nearing completion (sellers have to walk), in the same neighborhood, for $20,000 less. Lesson learned.