pre-foreclosure residence for great equity

[Alejandro Ruiz]

Investment Info:

Single-family residence buy & hold investment in Summerville.

Purchase price: $205,000
Cash invested: $15,000

Pre-foreclosure home for my primary residence. Found this property and made and offer after walking it. The house was on the market 6 days and already had 11 offers. Asking price was $189,000. Knowing that there was multiple offer on the table, I offered $205,000 and paid closing costs. Knowing the market and the area this was still a good deal.

What made you interested in investing in this type of deal?

it was great price for the location. and I was looking for a good school district for my daughter.

How did you find this deal and how did you negotiate it?

found it in the MLS with my agent at the time. I asked him to look for pre foreclosures and houses that needed to be fixed. I saw this property and he did not want to show me because it a pre-foreclosure and it would take too long to close a deal. I fired him and got another realtor who showed me a few properties including this one.

How did you finance this deal?

I was looking for a 203K loan but since this house was in good enough condition to live in it, I did an FHA loan and put down 5%.

How did you add value to the deal?

Still updating a few things like kitchen, floors, bathrooms, curb appeal. Comps in the neighborhood are around $120 - $130p/sqft and I purchased at $91/sqft.

What was the outcome?

Still living in it.

Lessons learned? Challenges?

not all agents are good agents, I fired my agent and it was and awkward conversation but glad I did because the next one was quick to show me this property and wasn't scared of doing extra work in the case it went to a short sale.