Any thoughts about this deal? - Posted by Chip J. (FL)

Posted by Ms. Leigh on November 30, 2001 at 12:37:40:

I would look to if you could get any more from the deal itself of course. 2.5 acres and two moble home units? How much is the house worth without the units? Are the units movable now or are they stationed? Is there any way to devide up the acres into lots? Are you looking just to get rid of it or are you considering staying in and getting what ever you can get out of it?

Any thoughts about this deal? - Posted by Chip J. (FL)

Posted by Chip J. (FL) on November 30, 2001 at 12:28:39:

Here it is:
House with two mobile home rental units on 2.5 AC in the country. All in good shape. Appraised at $140,000.00 by appraisal company 8/01.
Seller accepted my offer of Option to Purchase for $125,000.00.
My exit strategy is to sell the property retail for all cash for whatever I can get over $125,000.00.
The Option to Purchase gives me equitable interest in the property so I don’t have to be licensed to sell the property to a buyer and do a simultaneous closing.
Do you guys see any big problems with this scenario?
Thanks, Chip

Re: Any thoughts about this deal? - Posted by Ronald * Starr (in No CA)

Posted by Ronald * Starr (in No CA) on November 30, 2001 at 20:06:29:

Chip J–(FL)----------------

Just one. You don’t seem to know the value of the property. You mention an appraisal in August. Who paid for that appraisal? If the seller, you need to simply discard that information as being unreliable. You have to either have your own appraisal. Or, and this is much better, you have to know the market value from your own research, experience, and market knowledge and studying of the comps.

If you KNOW that the property is worth the $140K, then that is different.

Oh, wait a minute now. Somehow when I read $140K, I thought $180K. Oh, well then this really isn’t much of a bargain is it? Buying for approximately 90% of a figure that we have no confidence in? At least you have an option and can pull out if you can’t sell it or realize that it is not a good deal.

Good Investing*******Ron Starr**************