Posted by SueC on March 09, 2001 at 13:50:11:
Well it looks like even if you could get him to agree to let you just take over the loan, i.e., no cash on top of that, you’d still have negative cash flow from the rents. after taxes, etc. No wonder he wants to get out from under it.
Deal to bail out rehabber… - Posted by Tiffany (MA)
Posted by Tiffany (MA) on March 09, 2001 at 08:50:36:
There’s a deal or maybe not that I came across where a rehabber listed his duplex property with an agent. He had a construction loan at a really high rate, not sure how much. House got tied up for 3 months by a buyer that did not perform. Now the deal is so skinny for him that at most he’ll make 10k if he gets full asking price. Is there something I a can present to bail him out and most importantly make some cash. Agent says he’ll lower the price for cash. He’s asking 259,000. I can expect rents of 1500 and 950 for the two units. Thats not including vacancies and op expenses. Guy & agent are desperate (agent keeps calling me)so wanted to see if there is anything I acn work.
Re: Pass… - Posted by Jim Rayner (MA)
Posted by Jim Rayner (MA) on March 09, 2001 at 10:45:41:
Tiffany,
The asking price is pure retail and as an investment will be a negative cash flow deal. The real value of the rental income you have stated would put a value of 137.2K to 147K on this deal. I wouldn’t imagine he would discount that much but it never hurts to try.
Re: Deal to bail out rehabber… - Posted by SueC
Posted by SueC on March 09, 2001 at 10:15:40:
What’s the FMV? Don’t know if you’ll make any cash without that number. Why not take subject to, as long as you don’t have negative cash flow?
Re: Pass… - Posted by Tiffany (MA)
Posted by Tiffany (MA) on March 09, 2001 at 11:40:40:
Yeah, looks that way. The realtor says she could get 2000 + 1000 on the rentals, but I personally think thats high which is why my numbers are lower, but I could be wrong. Thanks Jim.
–Tiff
Re: Deal to bail out rehabber… - Posted by Tiffany (MA)
Posted by Tiffany (MA) on March 09, 2001 at 11:28:42:
FMV is 269000, Price was originally 265000, his bottom line currently is 250k because of this construct loan he has had since November. Thanks for your help. I’m willing to walk away, but they are desperate so I wanted to max out my options.
–Tiff
Re: Pass… - Posted by phil fernandez
Posted by phil fernandez on March 09, 2001 at 13:31:23:
Don’t let the realtor or seller tell you that the rents could be raised. maybe they can and maybe they can’t. My come back when they tell me this is, " I base my buying decisions on the current performance of the property, not potential. "