Seeking wholesaling RE advice

[Pedro Cruces]

Hello Everyone,

I would kindly like to ask the community for some advice. I have a lead that kind of fell on my lap through word of mouth. The seller is an older woman in poor health conditions - currently in hospice - and her only daughter is trying to organize the whole transaction. After speaking to her daughter, I learned that two mortgages on the house total no more than $200K combined, per seller's daughter. She [the daughter] has been on-time with payments on both mortgages, so the house is in good standing with both lenders. The house is in a hoarder condition - probably a nine out of ten on a scale - and will need a total rehab. The daughter has become financially stressed out with the home; the home has drained her rainy day fund throughout the years due to paying for both mortgages. She revealed that she wants no less than $125K - $150K in profit after both mortgages are satisfied. I have yet to dig deep into the market research, but superficially - Zillow est. $499,091K - while five other different websites estimated the property at $499,000, $465,557, $483K, and $458,000, with Zillow's estimate included, AVR averaged at $391,108. If the daughter is correct regarding both mortgages' balance and is under $200K, that would leave me a $191K equity to play with if we use the AVR average of the five other AVRs.

I am a total newbie to the REI world. In the last months, mostly during the lockdown, I studied RE heavily and better understand the RE world now vs. before. I do not know what my RE niche will be yet, but I am in the works of shaping that vision the more I learn. For now, I envision myself making some wholesale contracts to raise capital for future ventures. With all of that said, I want to ask the community for help. Am i missing something in the equation above regarding the lead I am following? What advice would you give me for this transaction to be successful and fair for all parties involved?

The seller's and daughter's problem:

1. a) Per the daughter, previous RE professionals have told her that she can't "Get a POA document signed and become eligible to make RE transactions on behalf of her mom." i.e., sell the house. The daughter has grown STRESSED not to sell the house without her mother's signature, but the mother cannot sign due to her medical condition and hospice. The daughter is scared that her mother's home will probate if she happens to pass away. She is an only child, the father is deceased, and the mother's health is volatile. She has received mixed advice regarding what she can do to be able to sell the house.

My solution: I am researching VA RE laws regarding next of kin POA and what powers they can execute under such a document. I have reached out to a RE attorney to consult regarding VA laws. I want to know what solution I can bring to the table to get this seller and the daughter under contract.

My execution:

1. a) Figure out what I need to do to legally allow the daughter to sell the home before the mother's foreseen death.
2. b) After solving step (a), work out a contract for the sale of the house after crunching numbers. I am fully aware that I will not be offering the seller internet math; meaning, I will not offer $350K for her home because Zillow estimates the house's AVR at $499K. If I can contract the house, I plan on getting my GC to give me an accurate rehab cost.
3. If numbers work, I plan on offering no more than $270K for the home. This estimate is my "he knows nothing" estimate but will get tweaked pending GC rehab estimate, mortgages balances, etc.
4. c) If all planets and stars aligned for this deal, I will find an investor, offer a fair price, and hope to make a nice assignment fee?

Am I missing something in my plan for this sale? Any advice from a more seasoned wholesaler? Tips? HELP! SOS!

If this happens, it will be the first of many deals to come. This online community and the podcast have given me the strength to follow my RE goals.