Found house for sale 35,000 below tax assesed value. Don't have 20% down

My wife and I just found a house for sale in are neighborhood for 250,000. The house is empty. We checked the county records and the house tax value is 285,000. They have a back tax bill for one year at 3,800. The house is 2200 sq ft. I believe the value is around 300,000. The problem is I don"t have 20% to put down. Is there any creative ways to make this work to have this as a rental without a negative cash flow. I have a credit score of 780 and equity of about 60,000. Please respond, I believe this could be our lucky break in real estate.
Thank you jeff

how long has the house been on the market?

have you checked the county records on the house?

Have you checked the comp prices in the area?

Is this your first property?

This is a new listing.

The county records show they are behind 1 year worth of taxes.
The county value is 285,000.00 land and property.

Comp prices are 275,000 to 300,000

Yes this would be are 1st investment property.


Based on what you stated on your posting it sounds as if you could qualify for financing on the home. You would need to put 10% down at closing. The question you need to ask yourself is… is this really a good enough deal for you to pursue? Your comp prices put the property sale price right at about 90%. Most investors that I work with only buy houses at 75% of value or less. Also, what is the rental market like in your area. Your payment will be above 2K+. Do houses rent for that much in your area? If not, what do they rent for? Do you plan to flip the house? If so what are houses selling for on average in your area? In Dallas it is about 94% of asking price. How long do they sit on the market? We are going into the slow time of the year for real estate. Do you have enough money to carry that 2K+ payment for 4-6 months if need be? Does the house need repairs? What are those going to run you? You need to have an exit strategy before you go any further. Otherwise your big break could turn into a huge nightmare.

Even a Hard Money Lender will want about $20,000 in liquid assets for every $100,000 you need loaned. (not up front, just as backup). Soo … for a $300,000 loan … youll need $60,000 liquid. Also they require pretty good credit scores of around 680. That being said … it is a good idea to Wholesale until you have cash to work with. In wholesaling you dont need any credit or cash (other than a small down payment to tie up the contract). Be aware though of what prices an investor in your area will need to buy at to make it a good deal.

Such is the case with one prominent lender, but not the rule of thumb for everyone in the niche…


Scott Miller