First deal... Looking for guidance!

[Caressa T.]

Hello everyone!

Here is an email I received after speaking with the homeowner over the phone today. He is relocating due to work and does not want to work with an agent.

"Only two options would work for me:

A) 100% cash at the time of closing-within few weeks up to 60 days max - provided some active conversations going on.

B) I will continue to be the landlord - getting market rent - will pay for services whichever applicable for managing property, collecting rent, etc. Along with the pending intent to sell 24 months from now (lease option)"

I was originally looking at this as a wholesale/lease option...

My questions: Can he still be a middle person in any way acting as the landlord for the property if we move forward with a lease option?

Should this be a wholesale deal instead? He does want a profit...

Here's the numbers:

ARV: $122-133k

Repairs: $10k (according to owner its cosmetic and external freshen up..sounds a bit much)

Mortgage: $42k (approx.)

His pocket $: $20 - $50k ($30k would be more ideal..his words)

Assign fee: $10k

Thank you in advance!!!

[Matthew Bond]

Yes, his profit is in the sale price.

$42K (Mortage) + 30k (Sellers Profit)  = 72K (Price you need to get the seller to agree to)

 You now market the property for 82k (The 10K difference is your assignment fee)

The buyer/investor you assign the contract too, then puts in another 10K in repairs, so he's all in for 92K, for a property with an ARV of 122K.