Wanted to share my experience with a recent land contract deal I finished late last year, for anyone that might care to read and could maybe pick something up from it. It was my very first, and although definitely no expert by any stretch of the imagination, I learned a good amount and enjoyed the process. *Disclaimer (lol): results probably not typically, as in my opinion it went better than expected, but the deal structure/approach would be the same for anyone looking to do something similar*

To start, I'll share where I acquired the property. My partner and I run a wholesaling company in Indy, so we're direct to a lot of off-market opportunities (shameless self plug: anyone looking to purchase in Indy, reach out to me!). Naturally, this one came in through the pipeline, and I wanted to give it a shot. The property was located in one of the better areas of Indy (Washington Township), was a nice 60-ish built brick ranch on slab with a decent yard, so I know it wouldn't have trouble selling. My idea was to buy, rehab it (above rental grade, but not a full blown flip), and sell it off-market.

Pre-Rehab:

Post Rehab:

The rehab took a little longer than expected given miscellaneous issues, but my GC and his crew were amazing and did a great job for me; there was no hand holding or watching over anyone's shoulders at all during the entire process. I did fear that given I would be finishing at the beginning of December, with the holiday season and winter setting in I would have to sit on it for a while- luckily, that did not end up being an issue. I anticipated having to use a local realtor that does a lot of land contracts to get the deal sold, but figured it wouldn't hurt to throw up some signs during the rehab to see what type of buyers I could drum up on my own. Again, I was lucky in that it worked. I only put out a handful of signs (which were taken down within a couple of days, other than the one in the front yard), I got upwards of 40+ leads. I lucked out in that one particular family had been looking for a land contract purchase in the area a couple months prior, and had lost the house to someone else. At that point, the house was practically sold prior to the competition of the work.

The entire process took about 2.5 months. I have a friend that frequently does land contracts also, and was able to get contract from her and an explanation of how the entire process works. I ended up doing a "kitchen table transaction," and saved money on not having to close through a title company.

Numbers:

Purchase: $54,499.50 (to include assignment fee and closing costs on the front end)

Rehab: $30,925 (had anticipated for large "unknown" budget, which luckily never happened)

Holding costs: $1,207.12 (to include builder's risk insurance and utilities)

Saved on: real estate commissions and closing costs on the back end (of which I anticipated when initially running numbers)

All-in: $86,631.62

I sold the property for $130,000, and was able to secure a $20,000 down payment from the buyer. I sold the home at a 9% interest amortized over 20 years, which comes out to $990.00 in monthly P/I payments. I will have a third party out of state company receive payments from the buyers and then disburse to me; they'll keep the schedule updated, report to the IRS at tax time, and provide online portals to both myself as the seller and the buyers so that they can see their payment history at their convenience, as well as make payments online.

Anyway, that's the gist of it. Didn't want to write an entire book on just one deal, but wanted to share, as perhaps someone could learn something or my experience might spark someone to look at one of their current deals differently. If anyone has any questions or anything to add, please comment away! And for those interested in Indy, feel free to reach out!

Cheers

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