Over my head!!!! - Posted by PUP

Posted by Carmen_FL on March 03, 2000 at 16:50:17:

I sell the note. I don’t want to hold yet. Someday, I plan to hold notes for monthly cashflow, but I’m not there yet (as an option to renting - I don’t want to be a landlord). Note buyers will tell you what their criteria are. Down payment varies from 5-20%, depending on credit, Loan to Value, and how much of a second you are willing to hold. But it’s usually much easier and faster for people to get qualified.

Over my head!!! - Posted by PUP

Posted by PUP on March 02, 2000 at 13:19:03:

I wrote a while ago about a property I rehabbed and am now trying to sell. It hasn’t sold and I refinanced the house to do some work on another property. The bills are mounting up and there’s no light at the end of the tunnel. I would like some suggestions. How do I get rid of this place fast? If something doesn’t happen soon, the bank might get it back. I’m in the middle of separating with my wife and things are coming unravelled. Should I just go belly up or what? Thanks.

Re: Over my head!!! - Posted by Carmen_FL

Posted by Carmen_FL on March 02, 2000 at 15:27:29:

What have you tried? Perhaps then we can suggest alternatives.

Owner financing, lease options, the “5-day auction” method, dropping the price (drastically), etc. are all quick options to selling the house. Some people have even suggested RAISING the price!

Since you’ve already refinanced, perhaps the quickest, easiest thing to do would be a lease option. Get a couple of thousand down, and let them pay your mortgage for 6 months/year until they qualify. But don’t sit back if you really want to sell it - walk them through the process, or have a good, trustworthy mortgage broker get in contact with them immediately after they move in to nudge them along.

We have a property we needed to sell ASAP. We ran an ad for owner financing 3 weeks ago - got 42 calls one weekend. No real buyers. A few flakes. We signed a couple of contrats (we have a clause that gives us, the sellers, 72 hours to approve/deny the client and gives us the right to check their credit, run them by our mortgage broker, etc.), but they fell through. We kept one person’s $500 down payment; another flaked completely as we were sitting down to sign, after we had her approved for owner financing (until then SHE was calling US 3 times a day - weird). It’s all a numbers game! The more people call, the more chance we have to get “the” buyer. We try not to tie up the property without an approval, a short close date, and money up front because people are too wacky.

We got tired of waiting, so we dropped the price $5K last weekend. Of course, we made it sound like more in our ad. We’ll only get $20K on this deal, and only $10K profit - but it’ll keep us moving forward. Now we have 2 offers on the house - the one we’ve accepted is supposed to close in 2 weeks tops (already approved, etc.). We advertised it in the paper as:

First $79K takes it. App. at $90K.
Owner financing w/$4,500 down.

We didn’t get as many calls as the one titled “OWNER FINANCING”, but we did get some better quality people (already approved). Next time, I think I’ll add “quick close” - seems that many, many people “have to move next week” so that seems to bring them in.

We have some other properties to sell, so this weekend I’m going to go sit at the flea market for a day (cost: $5), test the waters - with owner financing, “bad credit” mortgage programs, lease options, “fixer-upper” l/os, etc. we can get almost anyone who wants a house into one - so we’re trolling for buyers to flip properties to.

Hope some of this helped. Sorry for the length. Whatever you do, don’t give up or lose momentum.


Worst Case Scenario… - Posted by SusanL.–FL

Posted by SusanL.–FL on March 02, 2000 at 14:31:15:

If you REALLY get $desperate$, rent it out on a month-to-month…but that would be a LAST resort.

(Renters just seem to be able to pick up on the scent of fear…and you certainly don’t want them ‘going to town’ on your property—tearing it up!)

Good luck!

Re: Over my head!!! - Posted by Steve-Atl

Posted by Steve-Atl on March 02, 2000 at 13:38:03:

You don’t reveal the details in your post, but have you considered selling it with owner financing or on a lease option? I’ve generally found there are a lot of buyers when you make it easy to buy. Selling a rehab this way may not get all your investment back right away, but at least you have income to cover your payments to your lender.

Also, depending on how motivated you are, you may sell with owner financing, create a note, and sell the note. You will need to take some discount at the time you sell the note, but that discount can be reduced depending on the terms of the note you create.

The last thing I would do is let the bank take it back.

Re: Over my head!!! - Posted by Steve (NY)

Posted by Steve (NY) on March 02, 2000 at 18:39:24:

That was an insightful post.

When you sell owner financing do you at some point try to get them financed with an institution? Or do you just hold the note?