Posted by JohnB_NJ on April 18, 1999 at 22:56:16:
Forgive me I am still learning. I have a few properties tied up. One is a cash wholesale flip. No problem. The one that concerns me is my retail flip. The home needs very little work (around 3k for paint & carpets). I negotiated a 55k sales price. The ARV is around 80 to 84k. Now, I found a buyer with 10k cash and he wants to get a bank loan for the balance. Are you saying from the above post that I will not be able to do a double close because I can’t justify the increase from what i bought it at and what my buyer is paying? I just negotiated a real good deal with a motivated seller. I am selling it at ARV.
I want to own it for a few minutes. I surely do not want to own it for six months and have to get financing to buy it and hold it. This house only needs paint an minor cosmetic work that the buyer wants to do if I pay their closing costs.
Can I get these guys financed? I am taking them to my mortgage guy on Tuesday. My broker says yes…but maybe he is wrong. This is my first retail flip. Maybe he is refering to FHA which these people do qualify for. I will read Jackie’s articles again but i thought she was talking about cash flips and owner financing deals. My seller want cash now and will not take a note. I tried. So I made a lowball cash offer that they took after thinking about it for a few days.
As usual, thanks for your insight into this matter and thanks for any and all advice.