I came across a motivated seller with a sf home she is asking
120,000 which she said is negoatiable she also said that the house appraised for 143,000 last year in its current condition.
The house definetely needs a rehab I woukd like to put the house under contract and then sell my position to a rehaber.
can someone tell me how this is done. :help
I would do some reasearch on how much the home is worth NOW and how much she actually owes, then negotiate a better price. When you get to that price, get in on paper.
First, ask to see her appraisal from last year just to make sure shes telling the truth. If you were to pay 120k, that means the house must to be worth at least 175k after a rehab in order for you to make any money wholesaling it. If you think that is the case then write up an offer for the house at 120k, but subject to an acceptable appraisal and inspection. Now that it is under contract, get it appraised by someone who knows that you want to know how much it will be worth after the rehab. If the numbers still work, make some calls or advertise it to other investors at 70% of its ARV and collect the difference, about 6k. If the numbers don’t work out, tell her you can no longer pay 120k and offer less.
I agree w/ Moon struck and Eric.
An appraisal from last year is interesting foder only. Being as you are an investor that means you know your market or you are about to find out what the property is worth from some one on your team. No team ? Then call 3-4 realtors have them do a drive by and take them thru the property and find out what they say they can sell it for NOW. Not Market it for and maybe sell in 30 days but tomorrow by 5pm.
What you want is an Assignment of Contract form. Look it up on line, or mail me for one that you can customize. It is one page and you are actually selling the contract you sign w/the seller . I usually have my closing agent have my contract buyer pay and close on the transaction at the same time so there is no blowback. When you agree to purchase the property depending on how good the deal, will depend on how long you want the closing date for you and your new buyer/assignee.
This deal sounds thin at best so you will be marketing to a retail buyer or end user, you will want more time to close for marketing purposes.
Hope this helps, Darin