I need advice from those more seasoned. this may be my 1st deal.
The Details:
Owner has been trying to sell home for 120k with realtor unsuccessfully for a month.
Tax appraisal says 110 and they are usually a little off give or take.
I see owner borrowed 90k in January 1994 with monthly payments of 765
I believe it can rent for $1100.
How should I approach this?
Any assistance given would be greatly appreciated…
I emailed her some questions and the answers are below:
how long has the home been listed with an agent?
That house has been listed for at least a month. My ex listed it with an
agent
why are you selling?
We are selling because we divorced several years ago and he has lived there
since I moved out but he has now moved and we need to sell the
house.
what will you do if the home doesn’t sell?
I do not want to rent the house out because I need the money from the sale
of it in order to purchase a home for my son and I. I don’t trust renters anyway.
what is the lowest price you will accept?
Asking price is $120,000, at least $10,000 lower then new construction in
that area.
how much is left on the loan?
I’ll have to find out about the balance, my ex has all of that information.
what’s the total montly payment?
The monthly note was around $765.00.
Are you in a position where we could make payments to cover your mortgage
for a while and pay off any loans you have later?
The house needs to sell for us to have the cash out of it to be used for our
next homes.
What is your preferred close date?
We need to get rid of this house asap. If you can help, I would greatly appreciate it and I’ll get the loan balance from my ex and let you know.
verbatim,
Sorry you didn’t get any responses on this. I’ve been away for a while and not posting much. Here’s my take if it’s not too late…
Seller is not motivated yet. She needs more time to stew and/or she needs someone to hit her with the reality stick.
Here’s some issues I see…
House is listed. This is problematic - not a big obstacle, but a negative. Time and/or negotiation can resolve this.
She wants cash for the next place, but we don’t know how much. She expects to get enough cash for two places. We need to know the bottom line number she has to have, not want, and I’d prefer to know why.
Are you sure the total payment is only $765? Where are you located that the payment is that low and you can rent it for almost 1% of the sales price?
What’s the house actually worth? Using “a little off give or take” doesn’t get us there.
Here’s some issues she doesn’t see yet…
She’s competing against new homes in the area. It’s likely hers won’t compete well.
Neither she nor her husband will want to make payments on an empty home.
She never answered what she’ll do if if doesn’t sell. We need an answer. She obviously hasn’t considered that possibility and is convinced it will sell. Maybe, maybe not.
I typically say something like “when would you like to have this done” as opposed to “preferred close date”. It’s my opinion that simpler terms work better.
Anyway, that’s my two cents. On initial blush, it looks like one for the follow-up pile.
AK,
Yes, you’re partially right. It’s up to them to fill in the blanks. The problem is that most have never even considered that possibility. It’s my job to wake them up and this is one of the best questions there is. If they tap dance around it, I keep asking until I get an answer.
Contrary to popular opinion (including sellers), it’s rarely about price, it’s almost always about something else like finances, job loss, divorce, relo, etc. On occasion the response I get is that they’ll just stay where they are. Great, they go in the follow-up list because they’re not motivated yet.
So, how much deposit did they put down on that new house? Many will walk away from the deposit if their current residence doesn’t sell but they didn’t know that until they talked to me.
The question forces the seller to explore the depth of their desire to sell. If the driving force is strong enough, they suddenly realize they are flexible because they want this done. It then becomes about problem-solving and terms, not price necessarily.
If you ever get to experience the joy of being a motivated seller, the essential nature of the question becomes very obvious to you. :banghead