I have a potential client that has had her home on the market for 2 months and has dropped the price 25K to 135K. She is late on June’s payment of 1700 bucks and isn’t concerned with foreclosure (so she says!). She has another home to go to that isn’t in her name, so she is really trying to sell her home. The payoff is at 120K but she wants at least 10K. I’ve already tried to talk her down but she says she has a plan B (I have no idea what that could be at this point). I’m trying to think of the best way to structure this deal. She almost filed BK13 in Dec.'06 with the lender but is on a new payment plan at the adjustable rate.
Do I…
A) try to wholesale the deal to another investor quickly and just take a fee…on the surface it looks like LTV is 86%
B) try to wait her out and step in as savior to avoid the foreclosure and take the prop SUB2
C) talk her into SUB2 now and give her some cash now to vacate and give her some when I retail it later
With her high payment, this won’t be a cashflow prop for me and I’m not interested in tying it up long-term.
Thanks for the input in advance.
I think the deals too tight.
She just dropped the price by $25K. to 135K, she owes 120K and wants 10K on top? Forget it.
Here’s what we all need to remember…WE ARE IN A FALLING MARKET. No one knows where the bottom is but we are definitley NOT THERE YET. Look at the housing data. 17th staight monthly drop.
In this type of market you need to buy at BIG/HUGE discounts. If this place hasn’t sold after a $25K price drop then $135 is still too high.
We can all still make money but we need to be very careful about what we pay. A few years ago you could have grabbed this and by the time it was remodeled it would have appreciated just on time alone.
THOSE DAYS ARE OVER.
Find another deal.
ditto with pete
i see prices in chicago starting to be in the buyers favor (in some areas).,.,.,.,.,.,.,.as pete says u have to look…i agree
for a fun experiment i called tons of realtors the last 2 weeks and received there foreclosure lists…MY GOD!!! i apent 2-3 days calling realtors in a 60 mile radius of chicago…the lists are long…even the prelistings are long…all i can say is from my preliminary research there are some homeruns and very good deals,
i have a map of illinois on the wall and using pins…very interesting data…some small town cities are tanking big time,
my 2 cents
Robert A. Doncaster, Jr.
Import/Export Entrepreneur & Investor
*** DO YOUR HOMEWORK ***
Chicago Illinois USA
& sometimes Salzburg, Austria
I am with the others. There is not enough in this deal and if you have to convince the seller of anything she is not motivated. That amazes me because she cannot make her monthly payments and is not worried about foreclosure. She will worry soon if she doesn’t get a buyer and by the looks of it that won’t be coming soon.
If I were you I would tell her “no thank you” and move on.
I appreciate the candid advice. I met with her today to find out that her loan balance is 94K but she is behind 24K in payments and fees. She is in BK to avoid foreclosure. If she caves soon I’ll try to do a short sell with her lender who is a small outfit that is local here in TX.