Ok. I was looking for houses to do my first double close on. I found one in which the owner just bought the house at the end of December 06 at $879K. Right now they say that they want $960K for it, which is what they owe. A recent appraisal puts the home at $1.2 million. It’s a gorgeous home, in great condition. The recent (within the last month or two and the same block) comps are at the appraisal amount or higher.
Knowing that if they paid it off now, the amount they owe would be much less, what should I offer? As I said I plan on doing a double close and selling it to a buyer already in place. I know the amounts are high, but personally I don’t see the difference between this and a lower priced property since I have a buyer already and this is one that I’ve found that isn’t a short sale situation.
Before I called him, I wanted to see what I should say. Should I have him call the bank and get a current payoff amount then add what amount to it to get him out of the house? TIA!
I think you’ve got a GREAT deal here. It may not last long. Why not just pay full price? If you’re numbers are right, you’ll still make close to $240,000! I only have one little teeny weeny question? I wonder why the owner is too stupid to sell it for $1,2 million if that’s what it’s worth?
Maybe he’s smart enough to see that he got in over his head and doesn’t want to stick his head in the sand and wait for the inevitable to happen to him like most people do.
I know you have issues with me, but show some maturity and don’t be a wiseacre. If you have nothing constructive to say, don’t say anything. You may think that you’re hurting me by being mean, but you’re actually doing other people a disservice by not answering the question they may have but not posted.
If the deal isnt going to go anywhere on you start off exactly where you would want to get the house at, the worst thing they can say is no. If the deal has the chance of getting lost, then offer whatever your max is. Either way it sounds like youll do well. Just be sure your end buyer is good to go and get them through there during your escape clause time period.
It is often good to look at why people may not be selling for more, or why someone else isnt buying the home. I often have investors come to me with what they think is the deal of a lifetime, but I find out that the home has been on the market for 100 days and no one else has bought it. that means that every investor has seen the home and passed and for me to advise them to buy it, would be saying that I know more than every investor out there.
p.s pay no attention to the naysayers, most people would prefer you live a life of mediocrity. how that saying go “misery loves company”
I agree with ericmedem, make sure you know why they are selling (it could be its more than they can afford). Then I would us an option to buy with your purchase price. If they sign it then you have it locked in for that time period. Then just assign your option to your buyer for a fee. Know what you want to make before doing anything though!
Thanks, gentlemen. I have the reasons:
1 - Lives out of state and has other houses. He also has the house boarded up now because the last tenants got out of hand.
2 - Just bought the home last June and can’t handle the payments.
3 - His tenants are not paying the rent and he just wants out for this payoff price.
Ericmedem and WaInvestor: thanks so much for all the help. Where can I get my eyes and hands on an option to buy?
Search this site and you will find option forms. I had my attorney draw up mine for me. I work two states; I live on the border so have one for each state. All my options are for a minimum of 6 months gives me a lot of time. I very rarely use all the time but I like to error on my side. Any properties I work that are not short sales are always on options.
Thanks, I did find one. It was not state specific, however. But I am adding to my arsenal and I can see myself using it alot.