Posted by dan on June 09, 2006 at 10:55:12:
I have no problem being the pig. Another 3k isn’t worth losing the deal. But how about a lease/purchase with the intent of rehabbing during the lease period? I suppose I’d have to stick my 40k behind the 1st?? Not sure how that works. As far as the ex-wife goes, she supposedly wants out more than anybody. And according to the ex-husband she is OK with simply walking away. I’ll dig deeper.
Need help with rehab contract. - Posted by dan
Posted by dan on June 09, 2006 at 09:37:13:
I got a call from a homeowner who is willing to let his house go for the amount of his mortgage payoff. His ex-wife and his daughter live in the home, along with the ex’s new boyfriend. The daughter is turning 18 soon and will be moving out. The boyfriend wants a new home for him and the homeowners ex-wife. The house needs to updated inside but is stucturally sound. Owner is willing to hold 100% of the mortgage for who knows how long. After years of paying alimony and child support he just wants to wash his hands of the place.
mortgage amount 78k
arv 210k
repairs 40k
PITI 750/month
area rent 1000-1200/month
I’d prefer to make his monthly payments but defer them for the rehap period(plus interest). This way I can just finance the 40k and re-finance when rehab is done. THis should reduce my holding costs by 750 a month. My question is how do I write up the clause in the contract? And how do I protect my 40k while he has the responsibility of making payments? Once his ex is out he’ll be much less motivated to make payments. Is this too risky? If that doesn’t work I’ll just go hard/private money for the full boat.
It’s amazing to me that he is willing to let the house go for the exact amount that he paid for it 6yrs ago. I’m trying not to get excited and just get the contract signed before he changes his mind.
Appreciate your advice.
Thanks
Dan
Re: Need help with rehab contract. - Posted by Max-Va
Posted by Max-Va on June 09, 2006 at 10:32:47:
There are several different ways to do this.
Here is the one I would do;
Buy the property sub-2, if necessary put in contract that you will refi the mortgage out of the sellers name within XX months. You could ask that the seller pay you for 2-4 months of payments at closing. It sounds like you might have a deal here, but remember; pigs get fed, hogs get slaughtered.
Just a thought, who is on title? Do you have to deal with ex-wife as well? What does divorce papers say about the equity split? Do the DUE
Re: owner holding, I’ll finance the rehab - Posted by dan
Posted by dan on June 09, 2006 at 10:07:21: