How I Saved My Grandfathers 2 Family from Tax Foreclosure

[Nicholas Perez]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $330,000
Cash invested: $40,000

Hey everyone, I wanted to share a personal story about a property I purchased and renovated in Hudson County, NJ. My elderly grandfather owned a two-family home in the area, but over the years, the property had fallen into neglect. Unfortunately, he got behind on property taxes and was struggling to keep up with maintenance, so the place was in rough shape.

What made you interested in investing in this type of deal?

When I learned about the situation, I knew I wanted to help preserve the family property and also create a solid investment for my future. I decided to buy the property from my grandfather using a gift of equity, which allowed me to take over ownership without having to come up with the full down payment and pay for the tax lien and his closing costs. This was a great way to keep the home in the family and avoid the house going into tax foreclosure.

How did you add value to the deal?

Once I took ownership, I put in a lot of sweat equity to renovate the property. It wasn’t easy—there were tons of repairs needed, from plumbing and electrical updates to cosmetic fixes like flooring and painting. But by putting in the work myself and leveraging my skills, I was able to save a lot on labor costs.

What was the outcome?

After several months of hard work, I was able to raise the value of the home. The two-family property now has better curb appeal and the rental units are much more desirable, which has helped me increase my rental income. It’s been incredibly rewarding not only to save my grandfather’s legacy but also to build equity and increase cash flow.

Lessons learned? Challenges?

This deal was the catalyst that got me into the mortgage banking industry. After seeing the power of financing and understanding how loans can help make real estate deals like this happen, I knew I wanted to be a part of it professionally. Now, as a mortgage banker, I’m passionate about helping others navigate the world of real estate finance and make their investment dreams a reality.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

If you find yourself in a similar situation, I highly recommend exploring the gift of equity deals and using sweat equity for renovations. It’s a great way to add value to a property without putting a ton of money upfront, and it can set you up for financial success in the long run.

Has anyone else done a similar renovation project or used a gift of equity in their deals? I'd love to hear your stories and tips!