DEAL OR NO DEAL!!!

[Pamela Holmes]

What are all the options to doing this deal? 

A seller is selling his house for $170k. It's a 2 story home, 3 bed 2.5 bath, 2-car garage, 2,274 sq. ft, built in 1995

Here are the variables:

2 liens - Owe $103K:

 1st Mortgage - 28K - $1,100

2nd Mortgage - 75K - $330

Total monthly payment: 1,430

Repair estimate: $10k

ARV - $180k

[Jeremy Rubin]

If ARV is $180k and he's asking $170k he's asking for retail price... Doesn't leave room for you to make any money.

If market rent is $1200 and his payment is $1430 he will be loosing $230 each month he keeps it with it rented. Not to mention tax and insurance and maintenance and vacancies etc...

If he keeps it and doesn't rent it he will be loosing the $1430 each month and possibly paying rent in a new place too.

I would bring these points up with the seller, then I would see if he would be willing to sell for what he owes on the property. 

The purchase price of $170k isn't good for a flip or for cash flow. On the other hand a $103k purchase price will allow you to sell or hold and rent out and put some money in your pocket each month. 

Assuming the property is in Georgia I'm nearly certain you can find better cash flow opportunities if that's what you're looking for. There should be areas not too far from you where you can get close to 2% of the property value in rent each month.