need help finding high end buyers (long) - Posted by Terrance Hamel

Posted by JPiper on February 16, 2001 at 20:35:42:

It looks like you’ve worked hard on this deal…but I have trouble getting past that $9K going to the seller. You’re putting $4K in your pocket…and I guess a $200 per month spread in monthly payment (or is that the seller’s too?).

This would have been a deal I would have walked from in the beginning. $9K to the seller doesn’t look too motivated to me…leaving you with chump change and a good sized risk for $200 per month is you’re doing a sandwich deal.

Frankly I would go back and renegotiate. One thing to think about: a property management place won’t give her ANY upfront money. Nor should you in my opinion. Nor will they guarantee when the tenant will occupy, maintenance, or payments. Go rengotiate…and this time cut yourself in for a deal…or don’t waste any further time.

Maybe if your upfront money was lower you’d find a bigger audience…do you think?


need help finding high end buyers (long) - Posted by Terrance Hamel

Posted by Terrance Hamel on February 16, 2001 at 20:12:41:

I’ve had a property tied up for 4 weeks on a L/O contract and have not found a qualified buyer to act on it. The seller is moving in 2 weeks and she cant afford double payments. If we cant move it, she wants to use a property management company to provide a tenant to cover their payment. I don’t blame her; I want to be her SOLUTION, not her PROBLEM. She has had great faith in me, but I can tell its waivering.

This is a basic assignment of interest deal. Here are the specs:

Appraised 235k 4/00
Option cons: 13k (9k to seller and 4k to me)
Monthly pmt: $1925
Rent credit: $300
Option price: $230k up to 3 years
Loan Balance: 199k
Loan Int: 10.5%
Loan Pymt: $1825

10% Seller financing and outright purchase available.

I’ve put up bandit signs on posts and high on telephone posts in major traffic areas. In the nicer areas, the signs come down; the scruddier areas stay up. Most of my calls are from the scruddier signs and conincidentily, lower income people. I’ve never got a call from a sign in a nicer neighborhood, probably because it doesnt stay up long enough. I put the signs up every Friday after 5p. Even on weekends, the signs come down in the nicer areas. The signs read:


I’ve also a consecutive 2 week ad in the local paper under the FOR RENT section. 2 calls. It reads:

AREA (a must by the paper), RENT2OWN, 1925 PMT, 300 RentCR, MUST GO, OPEN HOUSE SAT/SUn 1-3p, PHONE

I’ve placed fliers in apts, but got hate calls from apt owners and after almost getting caught by a cop for tresspassing (owner was present and questioned me), abandonded that idea. That particular apt was low end anyway and I shouldnt have wasted my time there. Not all apts are low, but most are.

I’ve placed tear off fliers in credit unions. Got the stink eye from a few, so no fliers there. No calls.

I’ve placed fliers at new auto dealerships. No calls, still new though.

Fliers get placed at shopping stores near telephones while I am in the area. No calls.

I place bandit ‘arrow’ signs near the property on major streets the night before open house and always an hour before open house. The signs sometimes come down, even during open house.

I have a hanging sign in the owners yard. A flier box is filled with the terms plus optional terms. It is like a plant and needs a weekly refill, but still… no calls.

I have been contacting local companies that have big salaried employees to ferret out potential buyers that are relocating. I have found thus far, that it is all on contract and requires proposal submission to get on their ‘vendors list’. I am wondering if that is a dead avenue.

I have 2 people which qualify out of the 50 people that I have had contact with. Both saw the signs near the property and attended the open house. They each have about 20k NOW and say they can afford the property, but I only heard from one of them.

The one prospect is a vet and has a F/C on record which affects him getting financing, but he says he will be eligable for 6.x financing in 6 months through a special provision (dont recall the provision). I had an investor/loan officer speak with him and although they’d never heard of it, also said that even if it were true, buying out a L/O requires one year of occupancy as it is considered a refinance.

This prospect also is being careful to get into the home correctly, as they got F/C on due to high payments and an emotional attachment the first time. They dont want to make the same mistake again. I dont blame them. He is also having a RE agent/fellow churchgoer act as a buyer agent for him. The buyers agent wants to be at the next open house.

So I really could use some help with finding these high end buyers, whether it is fixing what I am already doing or learning to do something else. Thanks.

I know I’m biased… - Posted by Jim Pasquini

Posted by Jim Pasquini on February 17, 2001 at 02:12:22:

but I’d be PACTrusting this house in an instant instead of trying to L/O it. Just consider this one thing…you are asking a tenant buyer to pay nigh on $2000 a month rent. For someone that is going to be able to afford to live in this house this is going to be like making a $3000/month or greater mortgage payment depending on their tax bracket. On top of that you are asking them to come in with over 5% “down” for the opportunity to overpay. To my eye you are looking for needles in haystacks, and your results confirm it.

Re: need help finding high end buyers (long) - Posted by Bud Branstetter

Posted by Bud Branstetter on February 17, 2001 at 24:15:06:

For the management company she just wants to cover her payment. From you she wants 9K.

It sounds like a common problem on higher end houses. Too short an option period and too much consideration. don’t you know it takes 45 days to find that buyer. Oops, you only have 30+14.

I would have been advertizing it in the houses for sale section. No bank qualifying, 3 pmts plus closing costs, etc.

And this management company can put a renter in there overnight at $1825? I would give her the depreciation to help her not getting her 9K. I would give the occupant the interest and tax writeoff. I would give her 6K now if she didn’t get anymore at the end. Boy, I’m greedy.