Posted by johnman on December 21, 1998 at 20:06:37:
Read the answers to my questions about this deal and you will see that I am trying to acquire a property by having the owners transfer the title into a land trust. I won’t go into details of land trust because I’m not the expert but with this technique the seller needs to be motivated. This seller is about to loose their house. I have explained to them that the note will still be in their name but the title will be transfered into a land trust. I bought Mr. Bronchick’s course “Get that property out of your name”. This is what I’m using as a guide.
If you read another post of mine in connection with this deal, “A SELLERS’ QUESTION/CONCERN” , there are good tips here too.
To give you more to work with :
The loan is qualifying assumable
The loan balance is $58,000 (just found this out)
The houses sell between $70-$77K
Back payments and ins $3,600
Owed on new A/C $1,100 (just found out)
200 for title search
total expenses $8,100 (at this time)
If I intend to re-sale, it’s not a good deal! Here’s why:
Assume selling price is at $74,000
- $58,000 (loan balance)
- $8,100 (expenses fro above)
- $2,960 (4% negotiated realtor fee)
- $2,000 (closing cost approx)
PROFIT OF $2,940
If my math is correct, this isn’t worth it.
But if I hold it as rental, then I could do a lease/option deal. This would be profitable because I would probably received $2,500-$4,000 option money upfront non-refundable. Plus selling the property at $77-78K, plus rent. Then I wouldn’t have to dish out $2,960 for realtor fee.
I hope this helps you. I will post an update so the others could make their comments about my analysis.