Thanks for the reply, I am moving to Oklahoma and the house is in the town I am moving to, After further research it looks like the house would rent for $500-$550, I thought about faxing him an offer but he could very easy sell this home before I get back in town(I have seen properties like this come and go very quickly) I have a free round trip ticket i think I will use it and try to close the deal this weekend. Does my offer itself sound reasonable and if I could get $500-$550 per month could I make this property work?
I located a property in Oklahoma, a 3/2 recently remodeled(new roofing, rewiring, new paint inside and out and new carpet)home in a decent neighborhood. I haven’t yet seen the inside(have seen the outside and looked in windows) of the house, but I have contacted the seller, The seller is willing to hold a 25 year mortgage for 90% of the $45,000 asking price at 10% interest and seemed to be willing to take the remainig 10 % in the form of a note, (I considered offering to pay at 10% interest over 5 years This would make the payments for the first 5 years $463.63, and $368.02 after 5 yrs). The home could easily be rented for $550-$600 per month. Now here’s my problem, I’m in Houston and I am not scheduled to go home for 3 more weeks, With such a flexble seller and seemingly Nice asking price, I am tempted to fly home this weekend to look over the property and make my offer before someone else snatches this property up! Any thoughts or suggestions, Am I being TOO eager, should I just take my time or jump on this opportunity?
Your financing will cost you $463.63/mo, and you can
rent for maybe $500. What about taxes, vacancy,
maintenance and insurance? You will not make any
profit with the financing you suggest. You will
probably lose a couple hundred dollars a month.
No money down is great, but you want it to cashflow.
There is a lot of info missing here. Are you moving to Oklahoma? Are you familiar with prices/rents in Oklahoma? The $550-600 per month, are you using the Houston market or Okalahoma’s? What are the comps for that neighborhood? In any case, you can make your offer contingent upon you viewing the inside of the home, which should be in a few weeks. That will lock the seller in, but not you.
I haven’t received any responses yet, I would really appreciate some advice, I drew up a sales contract last night based on my proposal(a la Carleton Sheets)I’m just nervous that I’m pushing this thing
Excellent advice, but I forgot to mention a few things 1: I would pay off the 10% down pmnt after the first of the year, I just wanted to structure the deal this way so I could get it no money down. then my pmnts would reduce to about $368 per mo., I think $500 per mo is slightly below market value
2: I would actually live in the house with my fiancee until I am able to get financing for a new property, I was considering attempting to get an FHA 203b loan for a 4 family unit and living in one of the units while renting out the other 3 and the house in question that would give me 4 rental properties until I can refinance to get out of the 203b loan and find my next property.
Anyway I am in OK. now and am about to inspect the interior, I would appreciate any more last minute advice I could get before I make an offer!