Pre-foreclosure success story

[Ben Hoffman]

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $149,000
Cash invested: $44,000
Sale price: $280,000

Seller had been in the house since 1997 ample equity - he didn't have the financial or emotional ability to get the house in sale condition. I did a quick title search, caught him up on his mortgage (4 days before scheduled sheriff sale) and he signed over quit claim deed for $10,000 cash to move out. I paid his mortgage for the 4 months while I fixed the property and then paid off the principal balance after sale. The project netted almost $80,000 and was a win-win for all involved.

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

Relatively low money invested with high yield.

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

This was a referral from a past client so which created a foundation of trust.

How did you finance this deal?

Cash

How did you add value to the deal?

Most importantly I cared about the home-owner. I truly wanted to help him and with my experience and knowledge I was able to lay out his options and let him decide which route to choose. Through learning and experience I was also able to analyze the deal quickly which was necessary because the sheriff sale was less than a week from when we first met.

What was the outcome?

The home-owner was able to move on with his life with cash in hand. I was able to complete the project and turn a profit in just a few months.

Lessons learned? Challenges?

Everything from start to finish went really well with this deal. There really weren't any hiccups or significant challenges.