IS This A Money Maker? - Posted by Darrell Hale

Posted by Jim Kennedy - Houston, TX on November 27, 2001 at 17:25:01:

One way would be to wholesale it to a landlord or someone who wants to become a landlord. Whoever buys the house will have to honor the existing lease.

Another option would be to negotiate with the tenants to relinquish their rights under the lease. I’ve never attempted such a negotiation, so I won’t speculate as to the likelihood for success, but it might be worth a shot.

Hope this helps.

Best of Success!!

Jim Kennedy,
Houston, TX

IS This A Money Maker? - Posted by Darrell Hale

Posted by Darrell Hale on November 27, 2001 at 15:53:32:

Hi Guys, I need some help!

I recently started my wholesaling business, and I got a response from a guy and I’m not sure what to do with this one:
He has a House to sale. He owes 38K on the mortgage. The house is occupied with section 8 tenants who pay about 1K a month. They are on a lease which is up in April 2002 so they will still be there when the house is sold. Is there any way to make any money from this deal? I hope I supplied enough info. Thanks

Which state do you live in? - Posted by GlenSoCal

Posted by GlenSoCal on November 27, 2001 at 21:24:43:

I’m not sure if there are different section 8 rules for each state, but it helps if you include in which state you live. And the other big question is…how much does the seller want for the property?

Re: IS This A Money Maker? - Posted by SCook85

Posted by SCook85 on November 27, 2001 at 16:01:08:

You are missing one major piece of information. What is the home worth. If it is only worth $35k the deal stinks. If it is worth $100k, I’m still trying to figure out why you are asking if it is a good deal.

Steve

Steve, now you know you… - Posted by WilliamGA

Posted by WilliamGA on November 27, 2001 at 22:32:54:

…are my idol and all, but I gotta tell you, if it brings in 1k per month in rent and all he wants is 38k, I don’t care if it is only worth 30k, I would be interested.

WilliamGA

Re: IS This A Money Maker? - Posted by Darrell Hale

Posted by Darrell Hale on November 27, 2001 at 17:12:10:

The house is worth about 80K. I’m asking because of the tenants. They will have to stay because they have a lease until april? How would I wholesale this?

Re: Steve, now you know you… - Posted by SCook85

Posted by SCook85 on November 27, 2001 at 23:23:37:

William,

I totally agree with you that from a cash flow point of view, the deal looks great. He wanted to know if he could flip it quickly. If the home isn’t worth a good bit more then $38k, a quick flip is probably out of the question.

Still swaying,

Steve

A few deals like that - Posted by Terry (Houston)

Posted by Terry (Houston) on November 27, 2001 at 22:50:49:

and you can take a whole bunch of vacations huh??? HA ha ha

Welcome back guru! Missed you on the board.

Re: IS This A Money Maker? - Posted by JohnBoy

Posted by JohnBoy on November 28, 2001 at 24:13:29:

Also, does it need any repairs done to it and if so, what will it cost to bring the home up to market value?

He owes $38k and it’s worth $80k.

Is that $80k in top condition or as is?

What will he take?

What will it cost to be put into top condition and would it be worth $80k then or more than $80k after putting in top condition?

BTW, One More Question. - Posted by Jim Kennedy - Houston, TX

Posted by Jim Kennedy - Houston, TX on November 27, 2001 at 18:52:39:

There is another piece of information that is missing. At what price is the owner willing to sell? We know that the house is worth about $80K and we know that the loan balance is $38K. What we don’t know is what you would have to pay in order to buy the place. How much is the seller asking for the house? Is he willing to sell at a price that would allow you to turn around and wholesale the house for a profit?

Best of Success!!

Jim Kennedy,
Houston, TX