Advice on this deal structure - Posted by Mike G

Posted by Tim Fierro (Tacoma, WA) on May 14, 2003 at 24:29:55:

Seller to contribute 3% of purchase price towards buyer’s closing costs and any prepaids.

Seller to contribute 3.xx% to XYZ Down Payment Grant Program.

Closing to be on July 3rd. (Meant to be the first week of a month)

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And if need be;

Seller agrees to carry a 2nd deed of trust (mortgage? for your state) in the amount of 20% of purchase price.

You could go one more further and pay for the buyer’s home inspection and appraisal as those may be the only out of pocket things done before closing. But since she has $2k, she should be fine.

Advice on this deal structure - Posted by Mike G

Posted by Mike G on May 13, 2003 at 24:13:04:

In the middle now of what’ll hopefully be my first successful RE deal. I’d appreciate any advice you can offer regarding the structure of this sale…

2/1
ARV - $80k
Repairs - $5/6k (mainly paint and carpet)

Have it under contract for $45k. Am buying AS IS, paying buyer’s closing costs.

Am offering it for sale AS IS for $79.9k, offering to pay all closing costs. My ad in paper markets the financing rather than property itself and reads: “$1000 total cash needed w/ ok credit, seller pays all closing costs, 2 bed, won’t last! call xxx-xxx-xxxx” Have a good mortgage broker who’s experienced w/ all the various local gov grants and first time home buyers programs, etc.

Found a lady who’s already pre-approved for $80k, IF she puts 10% down. If I can help her w/ the down payment, she’ll sign tomorrow.

What’s the best way to proceed here if I want to get her financed? Take back a 2nd mtg for the down payment? Anyone have any experience donating money to 501(c)3 charitable organization, which then donates to my buyer and I get a favorable tax benefit for my donation (have heard this is possible under the right scenarios)? Could always GIVE the buyer some cash (about $6k) if worst comes to worst and still make out ok. Buyer has about $2k cash to work w/.

Suggestions?