I have the buyer, the house, but no $!

[MANUEL VALBUENA]

My Buyer:

- about to lose HIS house to foreclosure, has now stopped making payments.
- has $15k, and makes about $3k/mo in Tacoma WA, will probably save up a LOT of $ since he is not going to be making his trustee pmts anymore. ($3,500MO!! and the house is underwater)
- Obviously, His credit is shot, filed CH 13 plus he has Tax liens and Backowed Child Support up the rear. (about 70K total in IRS/Child)

The House:
- 2/1B in North Tacoma, tax assessed $190K, on sale for $150K but i will negotiate at least $125K to make it a 65LTV so an investor will look at this.

PROBLEM:
1. I can TRY to negotiate the deal to $120K from Seller so i can wholesale to Investor and make roughly $5k.
2. I can TRY to get my own financing through hard money ($120K) and get my Buyer into the house at least paying me the hard money payments, then 6 mo. later take a loan out at 75% LTV of a projected FMV of $180K which is $135K which would allow me to pay off HML and lower my interest in order to have positive cashflow from tenant monthly payments. then fix tenant's credit (?) and get him financing?
3. Birddog this whole damn thing to someone else to deal with it and make $2500.

-.-'

Please... options? :idea:

[Account Closed]

Have you pulled any comps on this house? I have several concerns about the scenario you presented.

1) It appears that you are assuming the tax assessed value is a measure of the actual market value for the house. I can assure that the likelihood of that is very small.

2) Lenders will look at LTV based on the selling price if you have no money to bring to the table and you make a offer of 120K. That is a 100% LTV loan request. In this market that is not likely to go anywhere.

3) You are taking on a serious risk if you assume that it is possible to pay off the hard money loan in 6 months based on a new appraisal.

Your going to want to get some comparable sales. You can go online to places like Zillow and redfin and find out what other homes nearby this Tacoma home that are 2/1 have sold for in the last month or two. The more similar to your property the better and knowing your market is extremely important.

Doesn't sound like your buyer could qualify for any kind of loan. Do you want to risk having the buyer bail when they can't make the payment?