Scorching Hott Short Sale Lead

An investor called me today off of one of my bus stop bench ads here in Chicago. He had a deal for me to think over but I have to tell him yes by tomorrow if we are going to do it…here is the scope and I’m basically looking for red-flags as to why I shouldn’t do the deal…

Brick Legal 4Flat in Chicago- 3(3) beds and 1 2bed…1 unit is a duplex
The investor negotiated a short sale with Homecoming to get this building sold for 155k…I checked with Sitexdata and sure enough that’s who the lender was…the original purchase was in fall of 2003 for 280k…

Anyway this guy offerred me the deal for 155k, plus 20k assignment fee… I have not seen the inside of the building but I have done a dozen rehabs in the area and even if it would take 100k to do the rehab, we would still have 50k in equity in the place at minimum… I have 4 comps, that are not rehabbed all selling for 319-355k in the last 120 days within 6 blocks of this place…

Investor said he will give me all of the short sale paperwork and I can have my lawyer look it over… Problem is they need the deal to close on Monday…I believe that’s when the SS agreement expires… I have a friend willing to give me 125k to do the deal-sight-unseen and I come with the rest… We can do a 50/50 split after we flip it AS-IS or flip after rehab and clear 50k… I have not done a SS ever, I’m working on 3 right now but I am 0 for 4 so far…And to complicate matters my RE attorney is just a guy I went to High School with who handles my basic deals… He is far from an expert…If you were me would you do this one? This is the type of deal that could get me more $$$ to advertise as well as more $$$ to pocket… My gut tells me the guy is legit but if I do this at a reputable title company is there anyway we can get hosed? If I costed this guy 100k, it would crush me and his wife would leave him… Sorry for the long post, but any and all feedback is appreciated…Moderators of this forum, please chime in. As this deal can happen as long as no unforseen risks are out there that could hammer us…

Luxx

DUE DILIGENCE, DUE DILIGENCE, DUE DILIGENCE…

Awful short time to put deal together…SS may run out but if bank gets another offer right behind, or at least a call to extend, they might go for it.

Sounds like it may work.

Kevin