possible deal - looking for input - Posted by Greg

Posted by Greg on August 15, 2003 at 21:39:26:

Thanks for your input. I will investigate that “option”.


possible deal - looking for input - Posted by Greg

Posted by Greg on August 15, 2003 at 13:19:34:

Any feedback is GREATLY appreciated.
Got a call today from a seller off my great (well, maybe) magnetic truck signs. Seller has a 3/2 townhouse, about 1600 sf with a 2-car garage in a new (2002) gated community. They’ve been transferred and are heading out next Friday. They tried to sell conventionally at retail, with no luck. Tirekickers’ major complaint was that it was “small”.

Here’s some of the information I have so far:

mortgage balance - $186K (so says seller)
payments - $1634 (does not include T&I)
Taxes - $2200 (but I think that’s still just land at this point)
Insurance - $300
HOA and maint. - $180/mo.
Financing is in the sellers’ parent’s name at 9% fixed.

I’ve checked market rents as close as I can get them and they are in the $1300-1500 range.

It’s got some equity there. Pulled up 4 good comps, averaging out at about $212K. I’m thinking the only 2 ways to do it would be on a sub2 or a L/O contingent on my getting someone in there.
One big problem I see is the payments + HOA/maint. + T&I do not make for an acceptable rent.

Anybody see anything else that might work? Or see any reason to back off?
I’m not in love with the payments or existing financing, but would like to make a deal if there’s one there.

Thanks for any help,

Re: possible deal - looking for input - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on August 15, 2003 at 16:20:46:


What will the owners do if you don’t help them?

Maybe pay two mortgage payments for a while?

So, why not offer to buy the property on a straight option? With a little cash for option consideration, but not much.

Then you try to resell at a higher price than your option price–which should be very little above the loan amount.

You only try to sell to somebody who either can qualify to assume the loan or can get a new loan. If you don’t find a buyer, you don’t lose any more than your option money and marketing costs and time.

Good InvestingRon Starr**