purchase property - Posted by david

Posted by Matt on November 15, 2000 at 10:12:13:

Mark,
I am looking to be in about the same situation, would you be able to email me the option contract also? Thanks a million.
Matt

purchase property - Posted by david

Posted by david on November 14, 2000 at 16:41:18:

Hello everyone…A neighbor mentioned in talking that he was willing to accept a sum less than the appraised value of his house if the deal did not include a broker. He is in no hurry to sell his house since it is paid for and he is leaving to go to his vacation home for several months.

I would like to present several scenario’s to him relative to the purchase of his home; however, I do not want to give him the impression that I am taking advantage of something he stated during a conversation.

Currently, I am cash poor. I would like to propose a scenario whereby I pay him some cash during the month of February 2001 (assuming I receive my tax refund during that month), but purchase the home during the month of December 2000 so that I can prepare the house for sale at the appraised value.

Homes in my neighborhood are currently selling within a 60 day period. If I’m able to bind a contract with him in December, I would project a sale by end of March. This would allow for minimal dollars to be expensed out of pocket.

Since I am a novice at this, all thoughts would be appreciated. Thanks!

Re: purchase property - Posted by Mark-NC

Posted by Mark-NC on November 14, 2000 at 17:33:54:

David,
Given your situation, if I were you I would just ask the guy if you could put an option on the property, with the permission to show it. Then while he is gone, market it and see if you could sell it for a higher price. If you don’t sell it, nothing lost except your option fee. This way you won’t have to make the mortgage payments on it while you are trying to sell it.

I am not sure what type of work that needs to be done, hopefully it is just cosmetic. With an option you really can’t do anything about it, Just sell it as is.

This is just one simple way of doing the deal. It is easy to present and it is risk free for all involved.

Good luck!

Mark

Re: purchase property - Posted by david

Posted by david on November 14, 2000 at 19:54:33:

Mark, thanks for the response. Is the option agreement (OA) bound by a contract? The appraised value of the house is $350,000. My neighbor would agree to sell the house for $300,000. Would I include in the OA a stipulation which states all monies above the $300,000 would go to me? Again, thanks!

David

Re: purchase property - Posted by Mark-NC

Posted by Mark-NC on November 14, 2000 at 20:44:54:

David,
The option is bound by the option contract itself. There are a couple different types of options you can use.

One is an exclusive option. And the other is a non exclusive, which means that the seller is not totally bound to it but it gives you equitable interest in the property to be able to market it (It’s kind of like who ever sells it first wins, type of option).

As far as your question concerning the price. You are basicly going to put an option on the home for the 300k that you speak of. That is what you will owe if you excercise the option.

If you find a buyer you will enter into a standard real estate contract. This will be totally seperate from your option contract.

When you go to close you can do one of two things you can either sell your option contract to a buyer for a fee or have a double closing.

I probably have one I can email you. It is exclusive or non exclusive depending on how you fill it out. I don’t know if it is permisable in your state. That’s something you will have to check out.

Mark

Re: purchase property - Posted by david

Posted by david on November 15, 2000 at 16:19:45:

Mark,

Thanks for your help. It has been greatly appreciated. I’ll keep you posted with the outcome. Again, thanks.

David