Real Estate Emergency - What to do with properties inherited from death?

My dad recently passed away and he owns three properties; one that he and my mother lives in and two investment properties.

My question is how do I take this stressful situation and turn it into a blessing? One of the investment properties has a positive cash flow of $75 (that’s it) and the second investment property is taking a huge loss. The residential property was purchased at a higher price then what it is worth due to credit.

What can I do, outside of selling, with all 3 properties that will offer some reprieve to my mother who doesn’t work?

First of all I am sorry to hear about your dad. I am new to the real estate business so take my advice with a grain of salt. Since there does not seem to be very much equity or atleast not much cashflow I would probably sell using owner financing. I know you said that your mom does not want to sell the homes but if she owner financed them she would still be connected to them so to speak. When selling with owner financing you can typically get 5% to 10% down as well as positive cashflow each month. If she does decide to go this route just make sure it is written in the contract that she gets first right of refusal if they decide to sell in the future.

Take care,

How is titled in the properties held? Is there any life insurance?

Is there any room for equity-building? Makeing some minor imporvements may increase rental value. Are the renters on a month to month, lease. This all needs to be considered. I agree with Michele, that is definately one good way of maintaining some controll of the property while getting a large down payment, monthly income. This can be structured through a lease option with purchase to buy (Lesae Op), or an All inclusive Trust Deed (AKA AITD, land trust, wrap.) Do not tell your current lender about your sub contract, just keep your mouth shut. You can even use a third party to monitor that the money is being sent to the bank. Also, highly recomended that you get the check, and then make the payment to the bank. You don’t want to spark any due on sale clauses. It may be a lot of info, but may very well be worth it.

Good Luck.

Just remember, you do have lots of options, just explore them!