Trustee Sale

[Emerson Miranda]

Dear BP's,

How can I do this deal?

This house has a Trustee Sale on October 17th.

The owner owes about $300,000 to the banks.

She needs to pay $25,000.

It's a rental property with $1,500 rent.

The ARV with a $90K Rehab is $350k.

Is it possible to make this deal a profitable one?

Regards,

[Brian Burke]

There's no money in it buying from the owner (aside from short sale which most likely requires it to be exposed to the market).  The only way I see is if the lender opens the bid at the trustees sale for $190K or less.  If you had the cash and the knowledge of researching title to ensure that there were no other liens that survive the trustees sale, you could buy it at the auction (assuming that no one else outbids you by paying more than $190K which all it's worth at auction).  If successful, flip it. The numbers still don't work well as a rental even at that price unless you find a 4.5% cap rate exciting.