Rent or Sale in Texas - Posted by Richard

Posted by Richard on September 23, 2003 at 19:18:40:

My plans for this property are long term rental income. I have read many post and with my background I feel like building long term rental income would be best for me and my family. I have worked in property maintenance at apartments for 18 years. There isnt much I cant repair myself. I know the headache renters bring but I feel this would be the best way for me to build a income that would rescue me from my present job. I have little cash but I do have a good banker at a small bank that I am sure will be willing to work with me. I am excited about finding my first deal. If this one doesnt work for me, I will get the next one.

Rent or Sale in Texas - Posted by Richard

Posted by Richard on September 21, 2003 at 11:55:06:

Found 3bed 2bath mobile home on 1/3 acre lot. Needs a lot of cosmetic work. Just found out it was a foreclosure. Realtor has it listed for $17,000. Price includes land and 1979 mobile home. Its value is listed at $13,400 at the tax office. How would you go about figuring an offer on this property? I could rent it for $450. Its located on a rural road between two brick homes worth about $60K. Looks like a money maker to this “newbie”. Still waiting on the Lonnie book. I am in Texas and know there are strict requirments. Since I am looking at buying mobile homes on land to rent out…laws may not be as hard to work with as those flipping. I have many years experience in property repair and think my target will be fixer uppers to rent. Any advice?

Re: Going to auction - Posted by Richard

Posted by Richard on September 22, 2003 at 18:03:07:

Went to see mobile home today. Realtor couldnt get door open. Looked pretty rough from the outside. Looked in windows and the inside will need a complete remodel. Carpet, paint, doors…etc. Realtor told me it was being sent to auction. I am going to try and contact mortgage company tomorrow and see if I can make an offer. LOW offer. Thinking about $5000 for lot and home. If not, I will attend auction. Any advice?]

Texas? What street is that on? - Posted by Dr. Craig Whisler CA NV

Posted by Dr. Craig Whisler CA NV on September 21, 2003 at 17:09:13:

If memory serves, I think your foreclosures go fairly quickly in Texas, about 3 weeks or so. You may soon be able to buy this property from the lender, at a lower price, and without a sales commission being factored into said lower price.

Lenders usually don’t like to negotiate with investors before the sale when they become the actual owners, but, I would contact the lender anyway and just ask if they have ‘any’ REOs in your area. REO is bankspeak for real estate owned (by the lender). They may even mention that they are expecting this property to come back to them in a few weeks.

I would ask if they would take $10k cash for it when it comes back to them and see what they say. That is, if you have the money. And then I’d add, “and it will come back at THAT price, have you seen it?” “Phew what a mess”. You are negotiating already even before they offer to sell it to you, by giving them lots of reasonable reasons to accept a low price. You could also offer them $10k cash for their note, “as is where is”, and tell them you can finish the foreclosure and do the REHAB (hint hint—still negotiating)), and save them storage costs, vandalism damage, and resale costs (more hints as to why they should take your low offer—keep negotiating).

Follow up with a letter giving them the same offers in writting, and the same reasons to accept . Try to find out who the “loan committee is”. Loan committee is bankspeak for the person who makes the decisions on offers like this. Be sure to direct your offer to the “loan committee”.

I’d send another identical letter to his or her boss (sent by intentional mistake to the wrong person). :~)

One final comment. In short fuse foreclosures like this one, the real estate agent will usually accept a lower commission to facilitate a sale before the lender takes it back.

Negotiate or pay full price and a full commission when you don’t have to. Its your money. Its your choice.

The deal sounds good to me. I would go for it.

Regards, doc

Regards, doc