Here is my situation. I found a home in cleveland for $9000. I got owner financing 100 percent with no payments for 60 days. Payments 82 dollars a month starting June. The house needs 7-8k in repairs. Comps put it worth 50-70k but I feel it will realistically be worth around 45k. It 2-3 bedroom 900 square foot home. The owner is having me sign a promissary note and if I pay if off in 6 months he will credit me 10 percent back on the purchase price. He is quitclaiming the deed to me and holding a first mortgage on the property. Will this quitclaim give me the title to the home? Also my uncle is thinking about buying from me. I would like to charge 3-5k and let him assume my ownership of the property. If he agrees how would I put this deal together so that he can just take over property and hand me my 5k? Owner already said he would just need his information to change over responsibility of 9k debt on property? Would love some imput.
Do you know for an absolute fact that the ‘seller’ is the owner? Did you run a title search and validate his identity?
I’ll sell you the same house for $5000 on a Quit Claim.
You really need to do a “deep dive” on this. It may be legit but it’s smelling kinda funny around the edges!
Be suspicious and proceed with a great deal of caution! LIke I say, it could be completely legit but transferring property via a Quit Claim is generally not a good idea.
Keith
Keith,
Yes the company that owns it is the rightful owner. I had my cousin who is a broker check for me. The quitclaim the owner said would give me full ownership to the property but I couldnt get a warranty deed yet because there are just a couple hundred owed for the taxes on it. He is discounting the price for it to make the difference up.
9000$ for this property? Worth 45 000$?
Too good to be true?
What is his reason for selling? Why does a company own this thing???
Something doesn’t sound right about this…
It needs 10 k in work. There is nothing fishy. It simply needs work. So to get a home for 50 cents on the dolar after repairs if not a little less isnt unreasonable. It is down in a less desirable neighborhood but thats it. The county has it at 38k. My brother in law broke said it worth around 50k. If I was getting the home for 9k and it needed nothing I would worry. My family owns a construction company so I understand the costs. The owner is a company in connecticut
Interesting. Did you do a title search?
Also, you do know that a promisory note don’t go away - unless both of you agree in righting. It can even surpercede a BK.
Just be carefull, we don’t like to see people get their fingers burnt.
This is still not right!
(1) You didn’t really answer the question - Does the GUY that is selling it to you have the right to do so? Your answer says that the company that owns it has the right to do so? How is the company held? Does the GUY have the right to deal on behalf of the company?
(2) If there are a “couple hundred owed for the taxes on it” then you hust settle that out at closing - no mystery there and certainly no reason to transfer on a Quit Claim.
Anyone can Quit Claim anything. All a Quit Claim does is what it says, it ‘quits’ any ‘calim’ the individual has to a property. To execute one, you don’t even have to have a claim. I’d hate to see you pay $9K for a worthless piece of paper that “Joe Bag-o-doughnuts” quit claimed property over to you that really belongs to a company and that he really had no right to meddle with.
It would certainly be worth it to pay the “couple hundred owed for the taxes on it” out of your pocket to get a Warranty Deed. I’ll bet that if you propose this, he folds like a house of cards.
Just my opinion, but I’m betting that I’m pretty clos on htis one…
Keith
Definitely follow what Keith said. You want a warranty deed in your hands, otherwise there is too much room for something to go wrong.
…and what may go wrong is that someone else will have your $9K and you will have absolutely nothing!
What I am describing was a relatively common occurance when I was a kid in New England. I can distinctly remember my dad talking about this when I was like 12 or 14.
Keith
He is a member of the company that owns the property. I have contacted the company and he is able to deal on their behalf. My brother in law is a mortgage broker and looked the property up for me and his company is the rightful owner. Thanks guys for the advice too, dont think I am not taking it to heart. I have verified that he does own and have rights to sell the house.
Guys you are missing the whole thing…the man said the home is located in Cleveland, OH. I recently searched in that area and have come across way to many homes for that price…due to the economy.
Nope…I’m pretty sure that I didn’t miss that (can’t speak for the others).
What we’re trying to dive home is DUE DILIGENCE!!! We’re just trying to make sure that he’s covered all the angles and doesn’t get screwed!
Keith
Thanks guys and girls. I appreciate that you are giving me constructive criticism. It is only strenghtening my skills as an investor. I should of explained that there are quite a few houses for around this price in Cleveland due to the economy. I put an add for it and received 10 responses in 2 days. Due Dilligence is very important when it comes to this game we call real estate. As I said before I made sure the property was looked up and there isnt anything for me to worry about. As for the warranty deed, I talked to seller and let him know that I talk to other investors and he is happy to warranty deed the property to me.