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
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.