Offering FMV - Posted by Josh MA

import · February 7, 2001, 9:58am

Posted by FrankPghPA on February 07, 2001 at 17:34:03:

From what I understand about the PACTrust, that would be the only way to go.

import · February 7, 2001, 9:58am

Posted by Josh MA on February 07, 2001 at 10:58:50:

Say a House is Valued at $250K in a Prime Neighborhood and i want to L/O this house but he was skeptical of doing a L/O would i be able to offer him the $250K if he would give me the terms that i WANT? and would i still be able to Profit from this deal?

import · February 7, 2001, 6:20pm

Determining Local Rents post - Posted by Monique

Posted by Monique on February 07, 2001 at 19:20:28:

Josh,

Here is the post that I mentioned about ways for determining local rents by Phil Fernandez:
http://www.creonline.com/wwwboard/messages/7918.html

Monique

import · February 7, 2001, 4:06pm

Re: Offering FMV - Posted by Monique

Posted by Monique on February 07, 2001 at 17:06:36:

Jeff,

If you can get a large cash flow on the deal, paying full price may not be bad – particulary in an appreciating market as Matt mentions.

Find out what the fair market rent is in that neighborhood for a $250K house. For ideas on ways to find out market rental rates, do a search. I saw a great post in the last 30 days or so about different ways for determining market rent.

Then, if you can negotiate to pay your seller $500/month less than what you can quickly get from a T/B, you’ve created a nice stream of cashflow. If you can get rent credits too, even better.

If you think FMV is $250K, you should try marketing the house for $260K - $265K for a one-year option with your T/B. The rationale, of course, is that with a reasonable 6% appreciation, the property will be worth $265K this time next year.

Monique

import · February 7, 2001, 10:07am

Re: Offering FMV - Posted by Matt B

Posted by Matt B on February 07, 2001 at 11:07:06:

Sure! The appreciation on the property will most likely make it worth a bit more when the tenant/buyer is finally able to get financing. I wouldn’t bank on that, but it’s one thing. Another thing is to make sure that you get a nice big healthy sized rent credit from the seller. Then offer either no rent credit or if they ask for it, a very small one to your tenant/buyer. There are many ways to make a deal profitable in a lease option with little equity. Depending on the situation, you might just want to go for the deed or do a PACTrust.

import · February 7, 2001, 2:33pm

Re: How do you know when… - Posted by Jacque - WA

Posted by Jacque - WA on February 07, 2001 at 15:33:06:

How do you know when to go after the deed versus a PACTrust?

Thanks,

Jacque