Need Help -- how to structure this deal

The mortgage payment is not p.i.t.i.?

My dad always said you cant make a silk purse out of a pigs ear. For me the only way to make this one work is to take it "subject to" at the loan balance and lease option it on the back end. Problem here is most buyers in that price range don't want or need a lease/option. Most can finance themselves.

Lease options work best on homes that are at or slightly below the average cost for houses in the region.

MIchael

True the mortgage payment Is not P.I.T.I. Or may be I assumed. Anyways I am calling her tomorrow.

Your point well taken.
I can still try to get the pulse on the current tenant and see if he is open to lease option.

Otherwise moving onto next one.

True the mortgage payment Is not P.I.T.I. Or may be I assumed. Anyways I am calling her tomorrow.

Your point makes sense.
I can still try to get the pulse on the current tenant and see if he is open to lease option.

I got an email from the land owner and here is what she shared:

1) She Owes: $490,800/-
2) P.I.TI. ($4,496.36)

-- Principal 1,460.38
Interest 1,427.41
Escrow 1,608.57. (If only she can get out of Escrowing).

Here monthly Out of Pocket Expense for this house:

$4496.36 - $3800 (Rent is getting) = $696/- + $120/- (Pool + Lawn Maintenance) = $816

So yearly she is loosing $816 * 12 = $9792/-

3) The Market Value of the property: $512,000

The owner has virtually no Equity, The house was Purchased in 1992 for $312,000/-.

My aim even there is no money I would like to get this lady out of this mess, I know it is none of my business, but aren't we about helping others, it should not be always about making money.

My Thought, She should take a loss and sell this house while the tenant is still in there.
If she sells through a realtor at Market value, she will pay approx. $25K commission Plus Closing cost and then pay the difference.

She should Sell it as FSBO, for at lease $30,000 ($512K - $30K) grand below Market and have the buyer pay the closing cost. That way buyer also has the equity and may have to come up with less down payment.

Anybody if you have better thoughts I would like to pass it to the lady.
I am also going to my REI club meeting and get thoughts from other investors to structure the seal.

Regards,
Bimal

I have an owner who is renting out her property and just want to sell at this point but the property is free and clear property as is right now $329,500 from court records Zillow: show property at $357,204 to $402,804, Appraisal: Value Range: $367,963 to $497,832 and get this a property just sold in the same area for $550,500.

She is asking $300,000 and want to sell by April 30, 2016

Property: 4bd. 2.5 bath with new roof and updated kitchen and has been painted setting on 2 arcs of land. SHE WANT TO SELL BY APRIL 30, 2016.

How can I structure this deal?

HELP PLEASE!

Tony

Do you have any buyers? A lot of structuring the deal depends on what and how your buyers want to buy.

Tonight we had our monthly investors meet up and spoke about the situation my seller lady has and guess what, one investor showed interest in buying the property.

Given the fact the lady is in distress, at this point I am just trying to help her out and do not intend to make money at all.

Next week I will go to this house to take some pictures and pass it on to the buyer I spoke at the meet up.

I already sent an email to the seller asking her if I can share her information with the buyer, awaiting her reply.

Tony -

What your seller wants may not be practical, if she sells in retail she may be able to get more money, but she can't wait.

Have you tried running the numbers using the standard formula to come up with MAO. If so MAO is the best you can offer.

If the MAO comes out to be less than 300K that is what she gets.

Or you can do a Sandwich lease option in the time you have between now and 30th April if that is possible.

Regards,
Bimal

Hey Bimal thanks for your help can I ask what is "MAO"and how can i run this formula I know some lingo just not this one...Lol Thanks for your help!

The Sandwich lease would be great she just want out at this point and walk away I will ask her about this option of Sandwich leasing because selling out right is going to cost much more.

.

Thanks Nat Big Help!

Hi Tony,

Walt told you what MAO is.

Now here is the wholesaling formula

MAO = (ARV X .65) - repair cost - your wholesaling fee.

Eg

ARV =. 100,000
Multiply by .65. = 65,000
Minus repairs =. 15,000
=. 50,000
Minus Fee. =. 5,000
MAO. =. 45,000
To give yourself some wiggle room you may offer couple of thousand less than MAO.

To be less aggressive you may multiply. By .70 instead of .65

I would also suggest you read 30 Days to ........by Dean

Walt -- My friend thanks for your input and you link to unfair advantage, I love it.

Okay I was using .82 but will go with .70 Also I used the link that Walt list at the bottom of his page Great Info. with the 25:1 deals and targeting First Time Home Buyers is a Great idea!

You guy's are a true blessing!

PS. I will read Deans book 30 days!