what would you do

Question

i have a property on my hands wit a 84K mortgage and market value is about 125-130k...what can i do with this property? what are my options?.. i was really looking to wholesale, any advice is greatly appreciated.

J Scott · Answer

Not enough information...

Can you purchase it for the $84K mortgage payoff?  How much rehab does it need to be worth $125-130K?  What will it rent for?

Thomas Usher · Answer

You have to ask yourself "what are my goals?" How does this property's potential get me closer to where I want to be? If your only wholesaling property this property could get you 5 - 9 thousand. If your selling it in the retail market it could get you 40k or more (if it doesn't need repairs). You can hold on to it, bring it up to a rent-able condition, rent it out and use a portion of the equity as a down payment to buy other properties. Which ever fits your goals/plans.

Alesha Rayford · Answer

@Thomas Usher

Alesha Rayford · Answer

@Thomas Usher  this seller is motivated. I was looking to sell it to an end investor. I would love to keep it though, and fix it and sale for Retail price. I don't have the money to purchase it that way. What are the steps I need to take to get this house and sell to an  end investor? Or even what is a way I can get the money to purchase than resell ...I don't have the money or credit.

Alesha Rayford · Answer

@Thomas Usher  this seller is motivated. I was looking to sell it to an end investor. I would love to keep it though, and fix it and sale for Retail price. I don't have the money to purchase it that way. What are the steps I need to take to get this house and sell to an  end investor? Or even what is a way I can get the money to purchase than resell ...I don't have the money or credit.

J Scott · Answer

I meant can you actually get the seller to agree to the $84K sale price?

If the property needs less than $5K to make it worth $125K, it seems unlikely that the seller would sell it for that little (unless they had no idea what it's worth), as there would be lots of buyers willing to pay a lot more than $84K for that property.

Guy Gimenez · Answer

1.  How motivated is the seller?

2.  Will the seller allow you to take over payments?

3.  What is the market for such a house...in other words...what are possible exit strategies (rent it, sell it to an end investor, get it under contract and assign it for a small fee to end investor, etc.)?

Alesha Rayford · Answer

I just spoke with an agent to give me market value and rent rates. She will give me a call after lunch with that info.when you say purchase are you meaning do i have cash on hand to purchase?..nope.. The house should need no more than a 5k or less rehab. i will def update once agent gets back with me.  @J  Scott

Thomas Usher · Answer

I am a newbie just like you, but it seems that you would have a few options is this area. What part of the foreclosure process is it in? Can you still work with the person who bought the property or will you have to work with the bank/lender? If you can still work with the individual ( be absolutely sure) then find a way to take it out of foreclosure (pay pass due mortgage payments AFTER you get the owner to turn over the deed or get the property under contract) ( think about that due on sale clause ). Then you can get a hard money loan or private money to repair the property. Remember the rules of engagement whenever your reviewing a property for purchase. Never spend more than 70% of the ARV of the property while purchasing and repairing if you are looking to refinance or resell it quickly. If you are holding it your expenses shouldn't be more than 50% of your gross income from that property. PLEASE figure out your cash flow/profit BEFORE you step into the deal. Use the deal analyzer on this site before you buy. Read the article on analyzing deals as well. These are only suggestions from a NEWBIE just like you....

Alesha Rayford · Answer

i wanted to start wholesaling to gain enough capital to flip and buy and hold. the property is in pretty good condition. Just need cosmetic mostly paint oh and plumbing. the mortgage loan is in the foreclosure process, so how does that work? What do i do about the mortgage? @Thomas Usher

what would you do

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