All Forum Posts by: Don Gouge

I am not very smart here but it appears that you will be paying 14k out of pocket for the priviledge of losing $330 a month in the best possible scenario. What am I missing here?

Then I believe I would do the income approach to valuation.

I think a comp 2 miles away would be fine if there are none closer and there isnt a dramatic difference in the subject and comp area. If there truly is a shortage of comp properties and the area the subject is located in is dramatically different then you can use other properties of a different class to account for the area differences. For instance, compare prices of single family sales in the subject area to prices in the comp areas. Perhaps you can establish an overall price differential based upon the neighborhood. You then can apply this differential to multifamily properties. It's not a perfect method but at least it's something. Perhaps you could use the income approach for valuation.

I see disaster written all over this. If you sell with an agent you are going to lose 60-70k. How much is this hard money loan going to cost you even if you can get it of the margin is thin? You say it dosent need much work but you can easily spend 30-40k on not much work. What will be your holding costs between purchase and sale? What if you have overestimated the sale price? You have a razor thin margin here 200k sounds like alot but it can. Evaporate quickly when dealing with a million $ plus property.

This problem might not be as bad as it appears. Are there signs of settlement on the rest of the house? (sticking doors and windows, cracks in the wall? It might just need simple shoring up and bracing or it could need a completely new foundation. Don't let anyone scare you. Remember that most people you encounter with this are either issuing a cya report or trying to charge you for something to fix. Foundations  can be scary but not quite so much when you understand them.

Have your  banker state on bank letterhead that you have in excess of X amount on deposit and available for immediate withdrawl.

If you have the name of the deceased owner look up their obituary.  Often it mentions the names and where survivors live. Use a site like myfamilytree to search the survivors and it will give you their address. You can even look up the deceased on that site and it will give possible relatives.

I assume you will be paying cash. You will probably be wanting title insurance. There will also be a closing agent fee. Call a local title company that closes transactions and ask them for an estimate of fees.

The question is does she want to sell? She can probably live there right now and the cost is less than rent. I believe if the bank forecloses then the HOA lien gets wiped out. Your best bet is to wait until bank forecloses and buy it from them.

Unless someone has POA, this deal is close to impossible since she lacks mental capacity to enter into a contract. If her mental capacity is currently impaired, she will be unable to legally grant a POA. Her daughter would have to petiion the court to have her mother declared incompetent and then the court might retain some control over the management of her assets. This will be a mess.