I have all documents signed by owner to purchase their house before it’s foreclosed. I need some help with some items as this is my first deal of this sort. 1. House has to be decontaminated ($6300) 2. Repairs ($5000) 3. Lein by credit card company ($5000) 4. Foreclosure price (with bank) $66, 800. Estimated Sales Price $92,000. How would you structure the offer to the bank? 2nd Lein? Any information would be greatly appreciated.
I’m assuming you mean offer the bank some sort of discount, since they don’t own the house and if you buy it before the foreclosure sale they never will. In that case I recommend getting some short sale training.
If you mean buy it and reinstate the loan then 1 & 2 are combined as repairs which is low, I’d add $15K to that number ($26K). You’ll be reinstating the 1st loan but you didn’t mention the back payments? Back taxes?
Your Cash requirement is: Back payments + Repairs + Cash to seller + Holding costs (loan payments).
Your Net is: Sales Price - Cash req. - back taxes - sales costs - bonded assessments.
It’s never as much as you think, is it?
To squeeze more out of the deal you can offer the credit card company some money for a satisfaction or release of lien on the property. You might try $500 for a satisfaction or $250 for a release of lien.
Good luck