OfflineHello to my fellow DGF. I am a newbie close to putting together my first deal.
I was wondering if someone can give me a little advice.
I have a cash buyer that is very active and is purchasing multi family units and he wants at least a 12% return.
I have an agent helping me locate and sending me leads
and he has sent me a listing of his that is a triplex listed for 155,000. the rental income is 19,560 a year the last selling price was 200,000
in 2004 and the zestimate is 174,000(totalviewrealestate). the range is from 118,500 to 191,000.
I was thinking if I offer 100,000 this would be a 19% return the first year.
but then I could assign it to my investor if interested
for say 4,000 and this would still give him a 15 % return the first year more than the 12 % he wants.If accepted that is.
But here is my problem I was wondering how to present the offer to the agent?
should I have him tell me what he determines the value to be? or should I ask him to run comps on other simular properties in the area?
When I make the offer to the agent what process should I go through in order to get this offer most likley accepted?
also should I see if my cash buyer is interested first before I make the offer?
What if the agent wants proof of funds?could I ask the cash buyer for a proof of funds get it on contract if accepted then assign it to my buyer.
I have already told the agent that I am an intermediary
or a birddogger and that I am not a cash buyer but I have built a list of cash buyers looking for cash flow properties and he has been sending me leads that match my criteria so does anyone know if agents will work with us on and or assigns deals?
Well Any help or advice would greatly be appreciated.
All I need is some advice on moving forward on this deal.
Should I just flat out tell the agent my plan to lock it up and assign it to another buyer or will this be cutting my own throat.
Thanks in advance
Is this property fully occupied, when and how long was the last vacancy?
Does this property need any work at all?
What are the operating expenses besides mortgage payment?
How will you put it under contract?
How will you cover the earnest money?
Sounds like you need to have your buyers POF and earnest money when you make the offer unless you can solve the earnest money and POF.
Many questions to be answered!
Michael Mangham
MD Home Acquisitions LLC
Knowledge is power, but execution trumps knowledge. Tony Robbins
http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdhomeacquisitionshousehunter.com Bird Dog Site
http://www.mdlodeals.com Tenant/Buyer site
A lot of the answers depend on the knowledge (and integrity) of the agent. If this agent is unfamiliar with the assignment process or is unwilling to delve into that area; then you need to proceed forward by having the agent present the offer you think is best. With the proper escape (I mean contingency) clauses and the proper POF letter, you should be able to make a deal happen. By the way, I like your thinking about making the investor a better return. That is the kind of service that people don't forget.
Always Looking to Acquire Houses | Always Looking to Amaze Investors
Well guys I may be gettin ahead of myself but I am eager to do my first deal? I believe it is fully occupied And doesn't seem to need much work if it does than I will have to make the offer a little lower.
Sorry for all the questions I am just in a hurry to do my first deal.
What if this property is a short sale does that mean it can't be assigned or are there any ways to complete a short sale with no money down?
Thanks for all of your help guys.
God Bless DGF
Sorry for all the questions I am just in a hurry to do my first deal.
What if this property is a short sale does that mean it can't be assigned or are there any ways to complete a short sale with no money down?
Thanks for all of your help guys.
God Bless DGF
Don't rush
Know everything. If your buyer(s) knows you're new to this, kiss this deal goodbye;
They'll smell the blood a mile away, and go around you to the listing agent, who really has no allegiance to you if you aren't doing anything.
If you can't answer the most basic question of the condition of the house and the occupancy status, don't do anything until you get that info. Cease showing it or letting people know about it until then.
If not, you will lose out
Should the agent have the answer's to these questions?
I just need to know what my next step should be?
Do you guys think I should just flat out tell the agent that I plan on assigning this deal to my buyer if he can get a lower offer accepted?
Thanks for your help guys.
I just need to know what my next step should be?
Do you guys think I should just flat out tell the agent that I plan on assigning this deal to my buyer if he can get a lower offer accepted?
Thanks for your help guys.
the agent has the answer and you should disclose EVERYTHING you plan to do with the agent. Just even the thought of you being sneaky or suspect, he will dead the deal no questions asked. Be upfront.
Also, the bank may require a bank statement and not just a POF, so its better to know what exactly you have to present to the bank beforehand. Know what you're working with beforehand and always have a Plan B
Thank you guys for all your help I will keep everyone informed on how this deal works out.
God Bless DGF
I was wondering what happens if the tennent stops paying and you are unable to make the payments yourself and cannot find another buyer?
What type of risks are there when dealing with lease options to the investor or middle man?
The reason I ask is because the other day my neigbor came over and knocked on my door and asked me if I wanted to buy his mother's house before she forecloses?
I went and looked at the house its in one of the best neigborhoods in town.
its a 3 br 1.5 ba and its ARV is about 200,000 she owes 180,000 it could use a little repair nothing major though.
now here is the problem the payment are about 1260 a month.
I told him if he could catch her up on the back payments I could buy the house on a 15 yr lease with the option to buy for what she owed on it.
I have got my strategy planned out but I am just worried about what happens in the worst case scenerio?
Any clarification on the risk for me in this deal if everything went sour and the tennent quit paying and I couldnt pay the payments and the sellers ended up back in the foreclosure process.