Still Struggling...Need friendly advice - Posted by BR2

Posted by BR2 on May 26, 1999 at 20:36:12:

Sorry,

He wants what he owes, plus a few dollars for closing costs.

Still Struggling…Need friendly advice - Posted by BR2

Posted by BR2 on May 26, 1999 at 18:29:21:

Located a vacant home. Contacted owner who is motivated. A tree fell on the roof back in November and was left open all winter. Home is in need of approximately 7k in repairs for roof & flooring in kitchen. Owner states he only wants what he owes on property (32k) and will take a l/o or l/c, no money down. I know from my research that he only owes 28k.

Stats: Comps came in at 45k. I plan on offering 29,5.
Seller offered l/c @ 11%
Positive cash flow only $50.00 monthly

I was thinking about flipping once I make repairs or is this a waste of time. Any suggestions?

Re: Still Struggling…Need friendly advice - Posted by Bud Branstetter

Posted by Bud Branstetter on May 26, 1999 at 21:49:35:

If the balance is 28K and you have 7K in repairs you have 35k into it and 300+/mo holding costs. Not very much equity unless it will rent for a lot more. What happened to the insurance that the mortgage company would have wanted on the property? Did it pay off or is it still available. You could do a lot of repairs for 7K. Ask him to give you no payments for 3 months to get it repaired and occupied. There isn’t much profit to wholesale flip it. Retail is more lengthy unless you sell owner financed. You then recover your cash plus a little and a note.

Re: Still Struggling…Need friendly advice - Posted by JohnBoy

Posted by JohnBoy on May 26, 1999 at 19:16:10:

If he only wants what he owes, then that equals x dollars per month (his “actual” mortgage payment, taxes and insurance) and x balance remaining on the loan.

So offer to just take over his payments by assuming his mortgage “subject to”. That’s what he really owes!

If his interest rate on his mortgage is less than 11% then he wouldn’t be selling to you for what he really owes. He’d be selling to you for a profit on the monthly spread above his mortgage payments.

Re: Still Struggling…Need friendly advice - Posted by Tyler

Posted by Tyler on May 26, 1999 at 18:41:28:

BR2-

one question:

If the seller has indicated that he only wants “what he owes”, and you know from research that he only owes 28k, why would you offer him 29.5?

Just an observation…

NT