Speaking Of Flipping - Posted by Big Harold
Posted by Big Harold on November 15, 2000 at 10:14:23:
I’ve found a house that’s well below market value, and a buyer that responded to my ad for a lease-option. I’ve changed my mind since they agreed to that; I’d rather just buy it and resell it to them at a profit. These people will surely get approved for a mortgage through my broker, so I need to find the best way to structure this deal to get my cash out and not alert them to the fact that I’m doing it.
Here are the numbers: The house is for sale for $29,900 - a beautiful, totally redone 5 bedroom, 1.5 bath row house, in a questionable neighborhood, but still appraises for $55 to $60K. The people responded to my ad to lease-option it for a year, with $2000 down, $500 security, and $650/mo payments, with $50/mo going towards the purchase price of $50K. Well, now that I’ve decided to flip it to them, what’s the best way to do this, and maximize profits? I need specific answers, as I’m a newbie. I’ve heard of double closing, which seems the safest, yet cuts into my profit with two sets of closing costs. I could assign my contract, but this way my buyers get to see my profit margin, and will most surely blow the deal. How do I assign it without them knowing the dilio?
Any help on this matter would be greatly appreciated, as I’m going to sign the contract with the original seller tonight. This sight rocks!!!
Real Estate Investor