Posted by tang-0-rang on November 25, 2002 at 15:03:09:
nt
REO - QUESTION - Posted by Brannon Wade
Posted by Brannon Wade on November 23, 2002 at 10:02:21:
I was recently going through some records of the county appraiser on the computer. I noticed several lots owned by a local bank. I called and asked about them and was told I could come by and pick up a list. When I got there, the lady I had spoken with had trouble locating the list. She asked a gentelman walking by about them, who just happened to be the Bank President. He wanted to know how I found out about the lots and says that he will make me a package deal on all seven lots for $15,000.00 During the course of the conversation, he tells me the properties have been on his books for more than the alotted amount of time allowed, and he got a five year extension which has about one year left. He said he even tried to give them to Habitat For Humanity. Apparently, because of their proximity to town, the property did not fit within their guidlines. I do not know why these have not sold, but I do know that he wants to get rid of them. These lots are buildable. Location, condition of neiborhood, etc. are of no concern because I already own three duplexes in the same neighborhood and they do great. He told me $15,000.00, but I am certain that he will let them go for less. Should I give him a lowball offer that I know that he will turn down, and then tell him I will give him the full asking price in return for very favorable financing for builing new duplexes on these lots? Possibly even 100% financing? The financing is of more importance to me than is the price of the property. I have a friend who is an established builder who says that he can build the duplexes for about $60,000.00 with me doing some of the work, which I am capable of doing. The rent in this area will bring $625.00 - $650.00 per side, so they would definately stand on their own. My question is what type of financing do you think they might offer to get these properties off of their books as well as to generate profit from the loans for the new duplexes? This is a small town bank. I have excellent credit (780) and have borrowed from this bank before, although not for a mortgage. Any insight would be greatly appreciated.
Sincerely,
Brannon Wade
$15,000 for 7 lots is very cheap… - Posted by David Krulac
Posted by David Krulac on November 23, 2002 at 13:23:09:
where I come from.
You say that they are buildable, are you 100% absolutely, willing to bet your life on it certain?
If not you better check it out before going too far.
I have seen many times preexisting lots that don’t meet side setbacks, open space, off street parking, impervious ground cover requirement in the municipal code today. Each of thoses by them selfes are deal killers. If the bank has been trying to sell for 4 YEARS, I would be suspicious.
It could just as easily be a sensational deal as it being unbuildable. Check with the building dept/inspector/code enforcement officer/zoning officer of the local government, where the property is located. And I would do it Monday AM.
You have a lot of due diligence to do at least before I’d sign the dotted line.
David Krulac
Central Pennsylvania
Re: REO - QUESTION - Posted by JoeKaiser
Posted by JoeKaiser on November 23, 2002 at 10:32:29:
Where I come from $15k for seven (7!) building lots is basically FREE. I pay more than that in closing costs for seven building lots.
I’m guessing you’re missing an important piece of the puzzle somewhere. I’d want to make sure I do my homework here.
A second point . . .
The real estate business is composed of many many various and separate businesses. A few are, investors :-), agents, rehabbers, builders, appraisers, lenders, attorneys who specialize in real estate, property managers, contractors, escrow companies, insurance companies, inspection companies, demolition companies, etc.
An investor could be any one of these, but is not necessarily any one of these.
I buy houses, but I am not an attorney. Nor am I an insurance guy, or a contractor, or an escrow company.
And do you know what? I am not a rehabber/contractor/builder.
That “stuff” is an entirely separate business from what I do. Why do you assume that because you can make a deal on seven lots that you should follow that up with swinging a hammer? I maintain that if you’re clever enough to figure out how to buy buildable lots for a couple thousand bucks a whack, your talent does not somehow automatically condemn you to a six month sentence where pounding sixteen penny nails all day long sounds like a reasonable thing do to.
I buy houses and have no aspiration to become an attorney, or a escrow company, or God forbid, a rehabber.
“I’m Joe, and I buy houses.” And do you know what? That’s good enough for me.
Joe
Re: $15,000 for 7 lots is very cheap… - Posted by vern
Posted by vern on November 25, 2002 at 08:10:50:
See if you can obtain a signed letter (an option) to buy the properties at that price. Sometimes people say one thing on Friday and something different on Monday. Also, he is the bank president, what if he forgets who he talked to and what he offered. This will give you time to do your D.D.