Just wanted to get an opinion…please dont judge me as I am new to this and wanted to get started with what I thought was the best way possible…
Heres the situation…
I locked up on an option a 4bd 2bth 2 story, 1800 sq ft from a wholesaler with 2000 down in earnest money. Instead of paying cash right away (the wholesalers want to close in a week) , I told him if he would let me hold the property for 30 days I would do the renovations for it and sell it within that time frame. I am suppose to close on the 30th of May. now the renovations are done but my buyer is still seeking financing). I CANNOT FIND A HARD MONEY LENDER! I guess theres no money out there…my credit score is not great but I have 20% to put down. A broker found me an alternative and im wondering if i should go with this option he suggested…
Purchase price=75000
Private lender will loan 65000
I put 10,000 down (2000 Earnest money + 8000 down)
Ive put 8,000 in renovations
In exchange for this, he wants 65% control of the property and a 15,000 profit.
I am not trying to hold the property so I am trying to aggressively price it to sell. A realtor friend ran comps and told me that a good price to get it off the market
The ARV of the property is around 126,000. If I get 120,000 I figure:
Pay loan + profit to lender: 65000+15000=80000
Renovations=10,000
down payment=10,000
Investment =100,000
Sell for 120,000
120,000-100,000=20,000 profit
I know I am sacrifing a lot, but I dont want to lose my option and I am confident it will sell. even if my buyer doesnt secure financing.
My question is any suggestion on how i can negotiate better terms a little bit? or another form of financing? or talking to the wholesaler…