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Updated almost 6 years ago,
[Calc Review] Help me analyze this deal
Hey BP crew, I need advice on negotiating my first potential off market deal:
- SFH, will rent for $2,100
- Comps @ $330k after a lipstick fix up (max $5k in paint and a little carpet)
- Property will only cash flow if I have a total mortgage of $192k-$200k
That's a big gap to cover. What I know about the seller/property:
- Rentals fill in less than a week, properties in this area regularly sell for 10% above asking price with 8 offers
- The owner wants "as much cash as possible" out of this deal to assist in buying their next house
- They inherited the house and they're selling because they hate being landlords. Attempted to rent the place out but evicted 3 people in 2 years because they don't know how to vet tenants properly
- There is a mortgage remaining of about $80k
I know I'd be swimming up stream on this negotiation, but let's do a thought experiment: how would you approach this deal? My current hit points:
- $5k in in repair cost
- We'd close using my private money and hard money contacts, so no commissions for her to pay, much lower closing costs.
- Her tenant's lease isn't up until August, I could close now and inherit their tenant
- I'm funding with private money, so closing in a few weeks vs. trad buyer taking 2.
I've already presented a seller finance option, but it sounds like she wants more up front cash. Thoughts appreciated, thanks crew!