All Forum Posts by: Mike O.

I figured $25,000+$80,000 at $105,000 Sale at $175,000 less realtor and fees @ $15,750 = $159,250 less $105,000 estimated profit at $55,000 (est). I would imagine they want most of the cash upfront and will want more than $25,000 as well. Looking for ethical approach, but if I could somehow help the seller move to get a rehab started? Maybe a contract with some money down then rest payable upon death (as mentioned)?

Came across a seller with terminal cancer. Would like to sell their house. House is in disrepair. My initial estimate is at $80,000 to rehab. Current value as is probably $25,000. Problem is mortgage is $50,000. Anyone know of a way to tie up this property or a structure ARV in area would get $175,000> (I live in area). Just looking for ideas. Thank you

@Ellis San Jose

That is what I was wondering, if maybe this is unethical and has appearance of pumping up price. In my case the seller wants a bit below market price for the property as he has only owned it for about a year. He bought below market and then put over $100,000 in capex

I am negotiating the purchase of a multifamily apartment building (over a month trying to put together structure and find guarantor). In order to get the seller the price needed we are attempting a structure below...any help-advice or recommendations greatly appreciated as I already have a partner to guarantee loan and need to keep moving forward and get a PA signed.

Using round numbers for ease:

Agreed upon purhcase price $100,000

Bank finances 80% (takes first position) at $80,000

Seller carries back 20% takes 2nd position ($20,000) on single pay note due no later than 5 years after close, so no debt service on the carryback to include (verified with a couple banks I have called)

The seller would forgive the 20% carryback debt after loan close, which would make the 100% finance.

After consulting with accountant, forgiving the debt would mean I would need to pay tax on the forgiven amount and the seller would need to go through various steps to evidence I was not able to pay the debt...filings, recordings, judgements.

Myself and the guarantor would put down a 6 month reserve account and pay closing costs with cash. 

Quarterly distributions 

I have also considered letting seller keep rent deposits to reduce price?

Does anyoe know a way around this or another option? Could we execute a personal unsecured note outside of close that would be an addendum to the purchase agreement we give title company and bank or is this not a good concept?

Thank you!

I appreciate the feedback! I’ll take second look with your analysis/strategy in mind. Looks to be over priced. Thanks

thanks all!

I’m wondering if anyone could give me a hand on a potential deal I have found. It is a 24 unit apartment complex that is broken up into a 12 Plex, 8 Plex and a 4 Plex. In the last couple years over $100,000 has been spent to re side all buildings,there’s brand new parking lots,new windows, new hot water heater’s,new paint and new carpet. I have heard plenty of creative stories to get deals done. Looking for advice from some veterans to get this done? The owner would like $1,200,000 and will carry a note for $1,000,000 - $1,100,000. he ideally wants $200,000 down. As with most new investors I do not have capital for that type of down payment. A liitle about myself: I work a regular 9-5 job and also have a realtors license I have done two wholesale deals in the last couple months since starting to devote a couple hours a night to investing. That said...my long-term goal is to make enough money on a monthly basis to replace my 9-to-5 W2 income I am open to any ideas that may be creative in getting this deal done whether be taking on a partner who has the down payment or maybe borrowing the money from a bank. I have also thought about a master lease option that would not require a down payment, but owner was not too excited about that structure. I have no experience putting together a partnership deal or a seller finance contract. Fully occupied 24 units - 12 studio apartments and 12 2 bed 1 bath $175,000 gross annual income Taxes $17,000 Insurance $7,500 Utilities $35,000 (the 8 plex and 4 plex are not metered seperately,the 12 plex is seperate meter). The owner has no debt and looking to retire in a few years. Any help or advice would be greatly appreciated, even if advisement is to pass on the deal?

What are details of financing?

Since joining BiggerPockets I have done 2 wholesale deals and potentialy working on the third right now. My situation is such that a another wholesaler would like to bring me into a deal because they are not familar with the mechanics of a wholesale deal. Up to this point (with permission from owner) we have a negotiated a short sale with a bank on a pre-foreclosure. The other wholesalers not in a position to execute purchase agreement as they don’t have any intention of buying the property. I was a bit conflicted about this and advise the other wholesaler to be upfront with the end buyer and wanted full disclosure and transparency in the deal as I have read many posts indicating the lack of ethics used by wholesalers who have no intention of buying a property should the end buyer’s financing fall through. We have come up with...the end buyer plans to execute purchase agreement with the bank and place a wholesale or consulting fee in the purchase agreement which will subsequently end up on HUD statement at closing. Until now I have only done an assignment or double clise because I had the intention of purchasing the property as one of my exit strategies. I have never done or completed this type of structure any advice apppreciated?

Property in is neighboring state (South Dakota) Thank you for your input!