Please give opinion on unique possible first deal - Posted by Tim

Posted by TeddyB_SC on December 23, 2000 at 23:10:17:

I agree with Bill, lock up the deal. I am still looking for my first deal and learning alot as I go. My problem wasn’t the contractor(my friend), it was the realtor. I made the mistake of discussing rehab estimates with the contractor while we walked through the residence WITH the "realtor."
Don’t you know that the next day when I faxed my offer, I received a return fax that said, “I’m sorry, I forgot to tell you that the property went under contract yesterday.” Oh well, live and learn.
P.S. That was the first time the realtor(Broker for the listing agency) had actually seen the property.

Please give opinion on unique possible first deal - Posted by Tim

Posted by Tim on December 23, 2000 at 20:32:37:

First of all, Merry Christmas to everyone visiting the greatest web site on earth!
There is a house that I’ve been tracking & gathering information for the past several months. This will be my first deal, & I’m kind of nervous! 4bd. house…comps are 110-120k+…this house has the largest sq ft. & lot sq. foot of all the comps…been vacant about 2years…homeowner filed for bankruptcy which the cased closed about 1 year ago…homeowner owes about 4,100k in back taxes, & about a 74k mortage…as per homeowner, she told me specifically that lender told her that they would have to accept around 50k from me due to all the damage on house…from outside can tell it needs alot of work,but looks structurally sound (no foundation problems)…homeowner told me at one point house was appraised at 116k, but 2 years ago was appraised at 39k…status now - waiting on homeowner to fax her authorization to lender allowing them to show me inside of house, in which I was planning on bringing a contractor with me to give a rehab estimate…lender told homeowner that they were’nt even planning on foreclosing & were going to right it off. I’m still a newbie, & if anyone can share your opinions as to what you would do I’d greatly appreciate it. Merry Christmas!

Opinion - Posted by BillW.

Posted by BillW. on December 23, 2000 at 22:06:33:

Find out why lender would rather do a write off than foreclose. Sometimes, there are “other problems” that will appear that the lender is aware of and you are not that will kill the deal. Also, unless you’re real sure about your contractor, make sure you’ve got the property locked up BEFORE you show it to him. Sometimes, if you don’t, you will find out that “someone else” has outbid you. Just have a clause,if possible, that states deal is subject to your approval of rehab estimates. Also, if rehab is out of your budget range, consider flipping it to the contractor. They can often do the rehabs wholesale because they have materials and labor at a discount to what you will pay.
Good luck and go for it!
BillW.