50% owner financing, old FSBO, is this / was this a deal / dud?

Question

For those who helped me not make a mistake on a new FSBO deal i found in my area based on the numbers, thank you again so much for you're help. I did mention I have another lead but it's an old one. I don't know if the owner is still interested in selling his property or if he already did it. Regardless I would like to know from you guys and others is this a deal / not or would have been.

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Contacted: 10-15-14

Townhome

Free & Clear Title (100% equity)

Ask: $69K

Appr. market value: $40K

Sold comps (exact): ???? (what website can I search this for?)

Owner financing with 50% down

Reason for selling: obtain more funds (invested in too many properties)

Repairs: none (owner was fixing it up)

3bdrms, 2baths, 1,150sqft

Taxes current

H.O.A: $200/m

*don't know if it's still considered for sale / already sold but it is rented out *

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What do you guys think? ...... I wanted to do a buy & hold with this one but couldn't due to the 50% down payment and didn't know how to wholesale it, this was my very 1st contact with the owner (well the owners wife hehe!).

Rick H. · Answer

Maybe you should start buying and selling other things before real estate.

In order to know what you should pay for something, you need to know what you can sell it for.

If this were a pre-owned car, you'd be able to get values of similar cars by make, model, year, options, miles indicated and condition.

Then, you'd negotiate to buy with enough room to make a profit after estimating cost to recondition, holding and advertising. The difference is your profit.

Why do you think there's a profit in this house if you buy it?

I can assure you that you need a lot more than some agent involved. They just want to make a commission, which is understandable.

One way or another, you're going to get an education.

Guy Gimenez · Answer

@Octavia D.

I think you need to contact an agent/broker and find out the FMV for the property. Without it there's no way to tell if it's a deal or what exit strategies are available to you. But 50% down on a retail deal wouldn't make sense to me.

Octavia D. · Answer

I don't know for sure if there is a profit in this property, due to me not doing a deal yet i'm more focused on getting the hands-on understanding of the step by step process than the profit. Yet the numbers are important, my main goal is to own small apt. rentals so my main intention was to rent it out but due to there being H.O.A there. I figure to wholesale it instead but I never went any further with the process because I didn't know what to do and the seller decided to rent his property out again instead. I remember after a few days of him re-renting his property that through text he was still interested in selling it, but that was months ago (last year in october/november). I haven't contacted him since but still have his info. his wife provided me, I'm just trying to see if this is a possible deal or just another dud if it was / is still considered by the seller for sale. I'm also getting a better understanding of the ARV formula and based on my conversation with the seller / wife regarding this deal, he was doing the repairs, so I don't think a property inspection would be necessary.

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Is there a website where I can determine the Market Value without paying someone to provide that info. for me, because i don't have any money to pay anyone. Is there a website that helps with this or at least is close to it.?

Sonya Stovall · Answer

@Octavia D.  are you investing in TX?  If so, I think you may need a good realtor in your list of go to people when you are stumped.  By not being able to afford, if you are referring to paying realtor fees for buying a property or listing, I understand.  However, knowing that TX is a non-disclosure state(I moved to the DMV from Mississipi, also non-disclosure) you need someone that can help you in cases where you do need "inside information."  All good relationships at some point end up being mutually beneficial.  I am sure you can find someone that will understand, you don't need a realtor but  I need help/information at times.  Depending on your volume, you might need to let them benefit on one of those deals or send them referrals when they come your way.  I find that non-disclosure states and FSBO are the worse for that reason, the homeowner really has no clue sometimes and is going off what a neighbor said and the neighbor is not giving them all the information necessary to truly understand the financial implications of the deal. Good luck! and happy investing.

Octavia D. · Answer

I can't afford an agent / broker, so i'm using whatever experienced eyes I can find on here to help me understand.

50% owner financing, old FSBO, is this / was this a deal / dud?

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