I’ll try to make this breif, hopefully i won’t leave out any important details. My girlfriend has found a motivated seller who wants out. Here’s the deal.
1st Home: 210,000 Loan Balance/ 240,000 FMV
2nd Home: 20,000 in arears/ 40,000 FMV (Forcloses on Sep23)
The way she’s trying to structure this is as follows;
Take over payments on 1st house via sub2. L/O it for future value of 280,000 with an option payment of 30,000. Take the option payment and apply to the 2nd house along with a hard money loan for the rest of it’s balance. Then lease 2nd house through section 8 program and get free and clear $650/month. The original agreement was if my girlfriend could get the seller up out of the 2nd home, she would release the first home. My girlfriend agreed and said she would “try her best”. And with that she is going over today to sign the two seprate contracts for purchase. She says worse case senario is that she signs contract for 1st house and can’t get short sale and loan for 2nd house in time for forclosure and it will be the seller’s problem. Then she would have instant equity and a 30,000 option considertaion money.
Are there any better ways to structure this deal that will be both win-win and profitable?
What is the worse case senario in this?