Posted by JohnBoy on October 15, 2001 at 14:20:47:
What down payment??? The seller has NO EQUITY for you to justify a down payment! If anything, I would be requiring the seller to PAY ME MONEY just to take this PROBLEM off his hands!
That $5k he THINKS he has in equity is just AIR!
It would cost him over $10k just to pay a realtor a commission to sell the house for him. PLUS he would have some closing costs to pay!
If he were just to say here, just take over my payments and you can have the house, you would be saving the seller at least $6k CASH that he would have to come out of pocket just to get his house sold!
Is that $175k he owes 1 mortgage or does this have 2 mortgages on the property?
What are the terms of the mortgage(s)? Interest rate? Years? Is it a 30 year fixed rate?
What are the taxes? What are the principal & interest payments? How old is the loan? Sounds recent. Did they recently buy this? Recently refinance it? Take out a recent second mortgage?
As far as you L/Oing this to someone else, if it’s worth $180k, then $199k would be the price I would set on a L/O to my buyer.
I’d want at least $10k in NON-Refundable option consideration on this, more if I can get it. It’s option consideration, NOT a down payment. There is a difference. Down payments are for something you are buying. Option consideration is money paid for getting an option to buy.
Give more details on this and we can help you more.
Also, what do other houses like this one rent for in the area? What is the condition of this house? Does it need any work? If so, how much will it cost? How do you know that?