New Investment Idea! Gotta Look!

[Johnson Best]

Guess what~

So I ran into this joint venture investment opportunity, wanna ran by all of you and get some feedback (Appreciated!!!)

These deals ran in Los angeles / OC county.

The company buys directly from banks on their distressed mortgage loan, and then do the short sale process on investor client's money such as lawyer and double escrow it to a wholesale or company. We investor gets the difference after all expenses. They never fix anything, they said 65 to 80 percent of the time when they sold it to the wholesale company the owner inside the house are evicted or gone too.

See below for the whole cost / profit structure.

5% interest to the investor + 50% of the profit after sale (shared with all investors)

Legal fee $1,682.50
Transfer fee $848.10
Documentation $673.00
Asset Manager Negotiation Fee $13,460.00
Commission to Agent $23,130.00
Title Policy $1,877.00
Inspection fee $1,615.00
Escrow fee $1,509.50

TOTAL EXPENSES: (Auction Fee + Expense + Escrow) $54,890.10
TOTAL EXPENSE + PURCHASE PRICE: $727,890.10

PROPERTY SOLD PRICE $771,000.00
Projected Escrow Proceeds after Escrow Costs $726,204.90
Net proceed (After Expenses) $43,109.90
Preferred return 5% APR for investors $13,300.27
Profit sharing (1/2 investors, 1/2 Main Company)