I Am In Need of Advice!

[Shunda Walker]

Hey, y'all...

I am kind of a REI newbie here and I want to try my hand at wholesaling...commercial and/or residential.

I must apologize in advance...this is rather lengthy
:

1) I ran across a property that has been vacant for quite some time (since 2005).

2) I ran a property search and it turned up as being owned by ABC Investors.

3) ABC Investors was neither listed in the Dallas or Tarrant County Records for Assumed Businesses NOR with the Texas Secretary of State.

4) I called all the previous places mentioned in #3 for verification...they searched and said the company does not exist.

5) Confused, I searched the title for the owner before this fictitious company. I saw Mr. Ronald and Ms. Eva (not married or related) as the grantors.

6) I could not find Eva, but I managed to find Ronald, who told me he bought the house from Eva as a favor to her, but when he realized (after the fact) that the property owed back taxes and city liens, he "walked away" from the property. (his words)

7) The house is boarded up and the only way inside was through the back door as it was broken as well as the back windows. I decided to take a look inside.

8) The place was a complete mess! Debris was everywhere...graffiti and holes were all in the sheetrock in the living room...the A/C, water heater, furnace and plumbing are gone...the walls in the bathrom were destroyed...and the carpet was beyond restoration.

9) The roof, foundstion and frame were still sound...not sure about the electrical aspect, though.

10) I spoke to several REI folks here in Dallas about this and they were of the consensus that I take over that company and either rehab the house of flip it. I didn't do it because I thought I would be illegal.

In summation here is what I am looking at:

*House is owned by a company that does NOT exist, even on paper.

*Previous owner said he walked away because he was never told about the city liens and back taxes on the property.

*House is structurally sound, but a complete mess.

*Owner wants nothing to do with this property (obviously).

*ARV: $75K

*Estimated Repairs (I could be wrong): $24K

*Total Back Taxes: $30.6K

*Labor Liens via the City of Dallas: $1,200

Any thoughts, suggestions or advice would be most appreciative to this newbie.

I sincerely apologize for the long rant...I hope I haven't put y'all to sleep...LOL :oops:

[Jon Holdman]

All that ownership mess would be sorted out by a title company. If this guy Ronald claims to own it, and that claim can be substainted, then all this confusion isn't very important. If it can't, a title company might be able to sort out who the real owner is.

$55K is needed to make the house good and sell for $70K. That's not really enough spread for a rehabber. For the right rehabber with the right crew, it might work.

OTOH, you posted in the Wholesaling forum, which I assume means you want to wholesale this property. If you add a few grand onto this deal, then it really moves into the "too tight" category. I have to be honest, too, and say that a potential buyer will probably look at your $70K ARV, and assume that's on the high end. If its really $65K, and you're trying to sell for $57K, the deal is really tight.

Next.