Help on Equity Purchase

[Doug Haisten]

I am working with a SFR owner that has just received his NOD. He currently is about $8K in arrears. The property is 29 yo and in good shape. Zillow values this property at $300K. The only mortgage is in the amount of $235,000 made 12/03. I calculate about $60K in equity, not including any repairs, carrying costs, or selling fees (when I sell it).

The property owner doesn't have the money to catch up the mortgage and he wants to leave town as soon as possible. I have been discussing an equity purchase with him. We are going to calculate the exact equity and split it 50/50. The equity calculation will take into account arrears to be paid and repairs/rennovations made.

After we sign the purchase agreement and wait the mandated 5 days, I would pay him $900 to begin moving out. Once out and after we do a joint inspection I will give him another $2K. The remainder of the equity will be paid after I sell the house. The $900 and $2K is an advance on his share.

Question: I don't have the money to buy and renovate the house and hold it until it sells. That being the case I would rather sell this to an investor. Can I list on the purchase agreement "my name or assignee" so the deal becomes the investor's and I take a $4K fee and be on my way or would an assigment give the mortgage company heartburn?

Is getting the fee this way against any law or requires that I have a license?

This is my first deal...what "holes" does this plan have?

Thanks,
Diver Doug