Mrs Lahren who is 65 and on fixed income w/poor credit, has two lake lots, ea. w/ 150’ of lake front. (semi clean shore on lot 1) Lot 1 has 3+ bdrm / 1.5 bth, main house attached garage w/ rv spot on lot. In need of some repair and updating. Lot 2 has three 2 bdrm/1 bth year round cabins also in need of repair and updating, two are liveable. Mrs Lahren lives in main house, cabins are empty. both lots share water and septic. way messed up, well on lot 1 - drain field for septic on lot 2. Has been trying to sell. when I first met Mrs Lahren she owed 95k on lot 1, over the last six years trying to stay up w/ taxes she has refi’ed sevel times she now owe’s 170k on lot 1. lot 1 appraised at 223k last refi in July. She has no appraisel on lot 2 but owns out right. I’ve tryed maybe if she read it from others she will see she is NOT TO OLD TO START. what advice would you give someone who is scared. cause it’s all she has. could you folks tell her some options she has please.

                                                                                        T A

Sure, there’s always options. Of course, those options depend on what you’re trying to do and that’s not clear at all. Are you trying to buy these props yourself? Is she trying to keep them?

You mention bad credit BUT that she was able to get financing. How bad is the credit if financing is obtainable? What are the terms of the financing? Where is the $75K in refi money now? Basically what are all the numbers we’re dealing with?

DON’T use a refi appraisal as a value estimator. It’s not. Knock off at least 10% to get an idea of value for the property.


no I’m not trying to buy it - helping a close friend work her problems out. As far as the refi go’s her score was 588, she got a broker who put her into a loan she really can’t afford not a bad one but still one she can’t afford. That $75k was used to pay taxes and to play catch up with other bill’s though out the years and some recent maintance on the home. I guess the real thing she needs from you folks is more like this- this is what I have suggested to her ( but i don’t think she believe’s me when I talk about creating a positive cash flow for herself ) = leasing out the 2 good cabins and take cash to fix up 3rd cabin and others for leasing cause she owns this property out right. I’m trying to let her know she can create cash flow for herself.


your 65
you have formentioned property’s-owes 170k new loan on lot 1, owns lot 2 out right
your income is $2100.00 a month
your living check to check- nothing in the bank
your mortgage is $1450.00 a month=fixed,tax and Ins incl
after other bills lucky to see $50 to $75
a CS of 575

                     WHAT WOULD YOU DO

Hard to give any real advice yet, TA, as there is still not enough info provided. That said…

Don’t know where you are, but reviewing earlier numbers, I don’t know where you can still get a good lake lot for $223K. Would be great to know what the actual retail value for the lots are AND what is around them (what do the other lake lots/neighborhood have?).

At 65, I wouldn’t want to be trying to get into the rental game. Better option is to sell both properties, invest the cash into a relatively safe haven return and borrow against it to buy, and sell, better investments.

Assuming a $200K gross profit on each lot, she’ll have about $230K to put into savings and/or to pay off other debts, thus freeing up monthly cash. THEN, look at increasing wealth by using the profits from this to buy either money making deals or money creating deals.


Any solution that involves selling the lots indivudually may also require the seller to install separate well and septic on each lot. Is each lot large enough to support its own well and drain field?

Thank you Roger
this is what i was looking to show her.

Anymore folk’s

At 65, I wouldn’t want to be trying to get into the rental game. Better option is to sell both properties, invest the cash into a relatively safe haven return and borrow against it to buy, and sell, better investments.

and yes Dave you are right — house lot can - cabins lot different story


                                                                  T A Jackson

I definitely agree that she needs to be selling both properties and NOT get into the Real Estate. Sell both places and buy something (cash) that is really cheap in a small town. You can buy nice homes in smaller towns for $50K all day long. If she doesn’t have any money then she has no business owning two lake lots. Sell those b1tches and get a little 2 bedroom home in a small city. Then invest the other $150,000k in some safe mutual funds. Then she can have the $2,100 in income plus about $800 a month in interest from the $150,000 in mutual funds, and not have any mortgage. This should be plenty to live on.

  1. Sell properties. Estimate $200,000k profit.
  2. Buy a cheap house in a smaller town for around $50k
  3. Invest the rest of the money (approx. $150k) in a brokerage account.
  4. Live on the $2,100 (roughly $13 an hour) + $800. Enjoy a debt free life and have a little money extra each month.

When you’re older you need to simplify your life. Not complicate it with tenants. Sell the places, pay off her debts and pay cash for a small 2 bedroom house.


   Iron Range