Single Family Home Investment Question

[Andrew Fallwell]

Talked with a motivated seller (divorce and moved) this morning who is selling through a realtor.  Here are the facts of the situation:

-Been on the market for 6 months.  Original listing price $250k

-Asking price $195,000

-ARV $235,000

-Renovation Costs $40,000 (new roof, flooring, bathroom renovation)

Originally I wanted to BRRR this property, which showed my MAO would be in the $140k range. I offered $125k to start the negotiation. She said she can't go that much lower than $195k because of the following:

1. Realtor Fees

2. Her outstanding mortgage (didn't give specifics but I estimate it's around $150-160k)

3. She is wanting to use a little bit of profit from this house for a downpayment on a new place where she moved

Trying to not let the deal slip through, I offered to run some numbers on if I assumed her mortgage. She said she is open to the idea. Her current mortgage payment is $1,250/mo, and I've estimated other rental expenses (HOA, maintenance, CAPEX, management fees, insurance) at $600/mo. So, total rental expenses of $1,850/mo. Other rentals in this neighborhood go in the $2,500-2,750 range, so it should provide positive cash flow of $600+/mo

Here is my new idea of an offer to her:

-$150k sale price

-I assume the mortgage of $1,250/mo

-10% down payment of $15k so she can buy a new place

-I pay her 3% realtor fees at the current listing price $6kish

-So, my all in costs would be $61k (reno, downpayment, realtor fees)

-Even if I sold the property, I'm showing a profit of $10-15k if her mortgage is in the $160,000 range

My question is this: What am I missing, and does this deal seem like a lemon to you?  I have never assumed a mortgage and don't want to get in over my head with unanticipated costs or issues for the seller.  Appreciate any advice you all can give.