One of my distant aunt is very motivated about giving up her house. Her and her husband are making two mortgage payments and both live out of state. She bought the house 17 plus years ago. She is willing to sign over the house to me but here are the numbers.
Original loan was 45k
She took out a line of credit now she owes 140k
Her monthly payment $980
Insurance $800 a year
These were the some of the numbers I got from her. I know there are other numbers that I need to get to know if the deal works. Can anyone please let me know how to deal with this. I’m very green at Sub2’s and if there are anything else that are missing, please let me know so I can ask her.
Who can tell if its a deal or not you didn’t say what the place is worth. On another token Sub2"s are not for the novice. You should take a course. Sorry to be blunt. Herbster
Thank you for being blunt! I will find out how much the place is worth. What else should I find out? Can someone please list the things that’s needed? I am currently looking into Jim FL and $Cash$'s courses.
Yia, I have Jim’s course myself but both are excellant picks. Within the last few months Jim posted whats needed and a description. Just go to the search button at the top and run a sub2 subject 2 search. You’ll find it. Herbster
it’s good that you have decided to take action. You are off to the right start you have some really good information to begin, but you will need to know how much homes are renting for in the area, what other homes are selling for, the amount of repairs needed, which way your market is going to determine what your exit strategy should be.
Comps - 154k (Realtor.com)
Rent for a 3br/1ba is $1150
Amount owed - 140k (took out 70k in equity to repair the house) Refi in 2006
Original loan was 45k (back in 1990)
ARM of 4 point something % (She couldn’t give me the exact percentage)
Monthly payment - $980
Insurance - $800 a year
Tax - not sure
Water
Repairs - Roof, paint and new carpet
She put the money from the equity to replace the windows, put in a new furnace, and the sidings are all new.
A few of my exit stretagies are:
Assignment it to another investor for a fee
Lease Option
Rent it out and be landlord
Of these three exit stretagies, what would best suit for this property, if the numbers given work? Please let me know.
Yia, There isn’t enough spread for you to make this a profitable Sub2 deal. On another token and I could be wrong, but your comp from realtor.com I think comes from homegain.com. This is just one of many free comp sites out there and none of them are very accurate. Herbster
Thanks, Herbster for your input! I guess I was a blinded by the fact that this might be my first real estate deal and didn’t want to believe it’s a no deal. So, how can I tell my aunt that I won’t take over her house? She was really happy when I asked her about her house and the possibility of taking over her monthly payments.
If you can some how make this deals, there may be a way in it somewhere, don’t assign your aunts house to some bonehead that can tie up the property. That is route to go unless you have a solid agreement in case of recourse.
I met up with a few folks I met at a REIA club and we’re discussing my aunt’s situation. They said the ARM scares them because it could jump real high when it resets. She’s out of town and we’ve set up an appointment to meet with her regarding the house and the ARM rate in two weeks. If she can lock in her rates, and if it’s low enough, a sandwhich lease would seem do-able.