Posted by Joe Kaiser on December 28, 1998 at 23:31:18:
It’s always a good idea to have things thought through so you don’t end up wondering how to get yourself out.
You don’t need a big strategy or anything at this point, you need a tenant/buyer who will put a few dollars in your pocket, fix it up and refinance in sometime down the road. If you structure it attractively, the phone will ring like crazy.
And forget about that “qualified buyer” thing. My typical tenant DOESN’T qualify for much of anything.
I bought a VA foreclosure a few months ago on advice of a local RE agent/investor (first venture in RE investing). I low-balled the bid and got the house after the guy who out-bid me failed to qualify for the VA financing. I didn’t want to do any fix-up and just wanted to flip it. I let the agent have the listing for three months, but he didn’t get it sold and the listing expires this week.
I still want to just get out for a little profit and want some tips on how to structure a favorable quick exit myself.
It is a 1920’s construction home in a historic area. It’s 2,000+ sf with 4 bedrooms and three baths. I bought it for $43,000. Comps in the area run all over the place because the nicely renovated properties of similar size run up to $80,000+ but rough properties can go for $40-50,000. It needs about $10,000-$15,000 to get it in good shape, but I just want to get out with a modest profit.
Any tips on advertising strategy and creative offers to a qualified buyer if necessary? I’m concerned because activity has dropped off this month since the weather turned cold and the holidays are here. I want out in the next 30 days.
Welcome to the real world of investing. First lesson: Don’t buy in October, unless you’re prepared to hold until Feb or Mar.
Did you really low ball it? If you did,(and it sounds like you got a heckuva house for $43k) you shouldn’t have any trouble off-loading it to an investor/remodeller.Find out who some of them are and then start phoning and knocking on doors. Tell them you hit a financial snag and can’t rehab it as you originally planned. Also tell them you have shopped it around to a few other guys who are mulling it over (and do it). If you made the kind of deal you think you did, you’ll get taken out with a small profit.
Re: How do I unload this one? - Posted by rudy-austin
Posted by rudy-austin on December 29, 1998 at 04:10:00:
call every remodeler that will do a joint venture or they might buy it from you. Put an ad in paper–handyman special, cheap no down, owner finance on contract.Then have them escrow the repair $ an baloon out at sale. rudy,austin
Advertise: Handyman special - EZ terms. 1234 main St. 555-1212
That’s it.
Then when you get calls, if you can’t sell for cash, see if he’ll pay you your PITI each month on a lease for six months, after which he cashes you out for $50,000. Maybe put in there that he’s allowed to cash out earlier if he can.
Why would he do it? If your numbers are right, he gets $80,000+, he nets a minimum 15,000, and he might save himself $2000-$3000 in holding costs over a hard money guy.
Or, maybe a low down wrap to a good income/bad credit type.