Thanks for the reply. Your thoughts are correct. I have not made a deal yet and looking at the numbers is what made me post this question. I personally didn’t see a deal here because of the $16K difference in comps. I just thought that maybe you or someone else could see something that I may have missed. I appreciate your reply. I failed to mention that the guy who sold this house to this person had just purchased this house in April of this year. He paid $91,800.00 for the thing! He got the deal. Then he sells to this person who had bad credit for actually $114,703.20. I would imagine because of the age of this person and the lack of Real Estate knowledge and by not going through a lending institute that this person had no clue of what comps were and was overly anxious to buy there own house that the deal happened! . Would I be correct by this assumption?
Anyway Ed, my concern now is this:
How do I tell a seller who calls me and says “I see you buy houses and close quickly” why will you not buy mine? Do I just show them that they are over financed (in a polite way of course) through the comps and give them an offer like a straight option, where I may find someone who will pay the crazy price and I would have virtually no risk, or should I just simply pass and take my next caller?
Seller calls me with house for sale. I check comps on octitle and they are running $97,000.00. House is 1996 model in excellent condition. The owner, is a college student who has been accepted at a new college across the country and needs to sell fast. Owner paid $13,000.00 down to get into the house with an assumable seller carryback. Owner wants $13,000.00 and for me to assume the loan which has a balance of $101,000.00. What would you do?
I want to offer up a straight option to purchase. Does this sound like the best way to do this deal?
Also owner said that the original owner who is carrying the loan is trying to sell it for her too! He says that he gets a lot of calls, but nobody has 13K to put down. I think he is playing here Why, if the property has the value (which I don’t see here) doesn’t the original owner just pay the $13,000.00 and take back the house?. I think he is waiting for desperation to set in and buy for a discount. Am I seeing this right here?
Personally I don’t see a deal here. We haven’t talked about what your intentions
are in buying the house. I don’t know if you are buying it to live in it, or as an
investment none owner occupied. I’ll assume it’s an investment none owner
occupied. If so then you haven’t told us if you want to buy it to flip, which again
as you can see the numbers don’t work to flip. Or to hold as a rental which if that’s
the case, then what are the going rents in the area?
If this is something you want to pursue, then I would shake the monkey out of the
tree, ( meaning get to the bottom line) and show the seller your comps which will
demonstrate to the seller that his price is out of whack.
Based on your information, I don’t see a deal here. If you think the rents will support
taking over the payments, then of course that could be a consideration.
But even if you buy it T-O-P, I would be concerned about the seller carry back which
sounds like a wrap first. It looks to me like you doing a deal, just to do a deal.
This deal doesn’t warrant a lot of brainwork. I would be interested to know your
GAME PLAN in buying it, because I don’t see it as a deal. Remember Al, TIME IS MONEY.
The time you’re spending fooling around with this deal, you could be out finding a DEAL.
Re: What’s the best way to approach this (1st Deal) - Posted by Tim (Atlanta)
Posted by Tim (Atlanta) on May 16, 2000 at 07:34:34:
Maybe I missed something here, but you are proposing to buy a house that is valued at $97k for $114k? Now if the mortgage is freely assumable, I would offer to take over payments with NOTHING down. Then you could sell it for 5K down and walk away with a quick 5k. I would not touch that deal for 13k down. Maybe you should keep looking. Just make sure that the owner has your name and number so that when they are really motivated, they will call you.