Looking for suggestions/help with a seller

[Jonathan Newsome]

Hey BP! 

Looking for ideas or suggestions with this deal. I'll jump right into the details now. 

3bd/2ba SFH w/1,524 sq ft. built in 2004. Location: Waynesville, MO (20 min from Fort Leonard Wood)

The seller has remodeled the home, including but not limited to: a/c (1yr old), Floors (Pargo), Stain Resist. Carpets, Ceramic tile, remodeled bathroom (sinks, showers, fixtures), and new paint. No repairs needed at this time. 

The good: Home ARV is approximately $156k. It's a turn-key property. Current tenants paying $1,100 mo and will be moving out in Sept. (lease up).

The not so good: Seller has low equity in the property, so there's still a decent loan balance left. That being said, they did originally opt for a 15yr amortization with their lender... Seller is motivated, however want to get rid of the mortgage under their name (sub-to out of the question). They've tried listing it a few times in the past, but no luck selling. 

The properties don't sell too quickly in that area, however they rent like hot cakes! 

I'm looking for any suggestions/ideas to help this seller out. 

[Mitch Messer]

Hi @Jonathan Newsome and welcome to BiggerPockets!

You don't mention the seller's underlying mortgage payment, nor the exact mortgage balance. If I had to guess, they are negatively cash-flowing, plus they have no real equity, but I'd rather not guess.

Also, keep in mind that when the current tenants move out, there will be repair expenses: There nearly always are!

The seller could try refinancing at a 30-year amortization and maybe snag a low-rate mortgage. However, without knowing the payment and mortgage balance, it's hard to make more suggestions than that.

For the record, everyone says they want the mortgage out of their name: Sub2 works when it's the best of all the available options. This seller may not be aware of all their options yet!