My First Possible Deal- NEED GUIDANCE, PLEASE

[Sheena Prattis]

I am trying to purchase my first rehab property. I made an offer and the owner, who's an investor himself, basically countered and told me he need to have at least 19k for the house.

My question is- should I respond with another offer that's maybe a little less than 19k or should I accept the price he's wanting? He's willing to do a seller finance deal but stated only if I'm an experienced investor (which I'm not- I'm just starting out).

The home was purchased last November for 10k and my offer was $13,500 with 15% int, $500 down. Currently, it's only valued at $4,600 and the most it ever sold for was $15,000 dating back to April 1993. If I accepted the purchase price of 19k, I may be able to rehab it and have it as a rental for a couple of years, while at the same time, try to sell for about $29,900.

I really need some guidance on which way I should go, what is the best finance option, and should I respond with another offer right below 19k. I would like to respond back to the seller within the next 24 hours...so, HELP!

[Brian L.]

Originally posted by @Mehran K.:

@Sheena Prattis Don't force yourself into a bad deal, just to get started

Great advice! This does not sound like a good deal, there may be a piece of info missing, but I just don't see it. Don't buy this deal just because. Run the numbers, run them again, then act if the numbers add up. 15% is ridiculous for a long term loan, how long are you going to pay at that rate?

Remove all emotion and run the numbers.