Need your input on financing this property - Posted by Thurman

Real Estate Investing Real Estate Financing
1

Posted by Thurman on February 26, 2001 at 24:26:19:

Namely, there is the matter of the Realtor. Once the Realtor sees any creative offers (lease option, contract for deed, etc.) other than cash especially at the seller’s low price of $45,500; he could tell her that he can get a CASH buyer at that price and in fact, he could find another real estate investor, with the cash, at that price. Thus the seller may refuse to accept a written offer even though we had a verbal agreement on the terms of the sale.

Tomorrow, I will be meeting with the seller to try to “buy” some time to get the cash. However, if I am not successful; I have two choices: 1. Offer all cash in about 30 days and try to find the money in a week or two OR 2. Assign (sell) the purchase agreement to someone else for about $3,000.

Ed and Terry, I do appeciate your inputs regarding this deal.

Thurman

2

Need your input on financing this property - Posted by Thurman

Posted by Thurman on February 24, 2001 at 21:15:46:

This single family property is a three bedrooms - two bath house with nice garage. The house is clean and is in move- in condition. The house doesn’t need any fix-up.

The property was appraised at $68,000 about 2 years ago by a Certified Appraiser. The seller paid $65,000 for the property at that time.

Listed with a Realtor with a asking price of $65,000 about four months ago.

Reason for selling this property: She bought a smaller house in the same town.

She received a cash offer of $55,000 subject to the buyer selling his house in a different town. Later the buyer back out when he was not able to sell his house.

After seeing my ad; the seller called me and offered the property to me for the $55,000 price. After explaining that this was a marginal deal; she dropped the price to $45,500 CASH!

She said at that price she could pay off the existing mortgage of $42,300 + closing cost.

The seller motivation is debt relief and no ownership worries.

She NOT interested in lease/option, contract for deed, selling “Subject To” or any other creative offers.

My plan is to sell the property either with a lease/option program or help my protential buyer to qualify for a first mortgage needing about 10% down payment and with me carrying a second mortgage for the balance.

Problem: I have no money to invest in this deal or do I have the necessary credit to qualified for a loan.

I could ask for up to 60 days in my purchase agreement to find a qualified buyer however, at $45,500 she expect CASH in 30 days or less.

I could write the purchase agreement offering the $45,500 cash in 30 days. However, I may not be able to perform as offered and have a black mark on my reputation.

Any ideas? Thank you in advance for any helpful suggestions.

Thurman

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Re: Need your input on financing this property - Posted by Terry (IN)

Posted by Terry (IN) on February 25, 2001 at 08:20:46:

Thurman,

Get her on contract,pronto. Immediately start advertising “Owner Financing”. You’ll sell quickly and in the best case scenerio should walk away with $19,460 (possibly a bit more) in your pocket. Worse case might be $12,740 cash and $3500 second. If you need any help structuring this, email me.

Terry(IN)

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Re: Need your input on financing this property - Posted by Ed Garcia

Posted by Ed Garcia on February 24, 2001 at 23:43:15:

Thurman,

This is one of those deals where you just have to talk the seller into doing what you want them to do.

This deal should be done on a lease/option, or a wrap- around for a year. You say, she won’t go, I say, that you can get her to do it.

Here’s what you do. You make an appointment to see her face-to-face, no over the phone B/S. You simply tell her that you’re in a dilemma. You tell her that you can do this deal but that you need to buy some time. Tell her that you’re willing to Lease/Option the property for 12 months, at the monthly payment of the existing first mortgage, covering any expenses that the property encounters during that period of time. Tell her that you’re willing to pay her one-month in advance, and will continue to pay her in that manner, until you close the deal.

Explain the advantages of working with you, rather that just sitting on the house and having a negative cash flow, or renting it and having a renter who will not have the same pride of ownership as you?.. SELL YOUR SELF.

Thurman, this lady wants to, and needs to do this deal even more than you. But she’s afraid. You have to get her to have CONFIDENCE in you and to over come her fear. You have to CONVINCE her that she has NOTHING to lose. The only way she will be able to do this is, if she feels that you are the type of person that she can DEPEND ON. Are you? If you are, then tell her, show her, convince her, Thurman be honest with this lady and let her feel your sincerity. Thurman, if you can’t close this deal, you’d better hang it up, now go do it.

One more thing, if you can’t close this deal, call me at (909) 944-0199, I want a shot at working her.

Ed Garcia