Subject 2 wholesale deal

[Teedi Kelly]

seattle home

Value approx 245

Existing Mortgage 208k

PITI 1500

Seller wants 60k down

No balloon time. Life of loan.

What kind of investor would be most interested in this? 

Good deal as is or what would need to change?

Wholesaler wants 15k

Property could rent for about 1800 with some update and a 1/2 bath put in. Which would also increase the market value. 

[Steve K.]

There isn't enough information here to make an informed decision.  

What condition is the property, class A, B, C? SFR, condo, etc.? General location or the community? Is the seller trying to sell the property with assumable loan? How much does the seller want? HOA? Rental restrictions? Existing tenants?

Another point that's not clear. "Seller wants $60k down." Is the seller going to be carrying the mortgage? Lenders are the ones who require amount of down payment. If it's cash sale only, then "seller wants $60k down" is a mute point. If seller financing, you'll want to check current mortgage contract for due on sale clause. If it's a REO (owned by a lender), then there wouldn't be an existing mortgage. Junior position liens are usually wiped out in REO unless there is subordination going on behind the scenes.

In a buy and hold rental deal, the numbers have to cash flow positive for investors to get excited. If it's an appreciation play, then the exit strategy has to make sense factoring ins 10% real estate transaction cost plus profit. Meaning 6% buyer/seller agent commission plus 4% misc tax, transaction cost. Plus the rent has to breakeven with PITI factoring in vacancy rate.

My gut feeling is that the information is conflicting and I would not invest if this is all the info that's available.  :-)