hi all,
i doing a deal on a house which is 1762 sg ft build on a 200x100 lot but it also has a lot of the same size that comes with it......should i sell them together or split them and sell seperate?????
this prop is in atl ga
rheebaby
…
In my market it would be a no-brainer. Sell them seperately. I don’t know about GA Atl. Consider selling the lot with the house on it and holding the vacant lot, especially if the house sale makes you whole.
You may already know this, but I had a similar situation in DC a couple years ago. Here is my 2 cents worth. If you purchase the property under 1 deed/mortgage, and then sub-divide the lot, you are then changing the collateral that is securing the lender. The county jurisdiction may ask you to get a release from the lender saying that it is OK for you to divide the collateral into 2 lots.
If you purchase under 1 deed/mortgage, then sub-divide the lots and try to sell the first lot, the buyer will not be able to get clear title because your lender holds the entire piece of land as collateral for your loan.
Here is what happened in my case.
a. I bought the lot/house together. $600K purchase price.
b. I sub-divided the lot into the house w/lot, and 2 additional lots.
c. I sold the 2 lots…had them under contract to sell. $235K per lot, so $470K sales total.
d. The lender said: "hey, you are reducing our collateral on your property, you need to pay off the full amount of the loan…$600K which meant that I needed $140K (with expenses included) from a hard money lender to add to the $470K to pay off the loan at the closing table.
e. I then sold the house/lot for $465K, paid off the hard money guy with $140K, subtracted commissions, closting costs, etc.
If you are going to sell one thing first, try to sell the one that pays off the entire mortgage if possible.