All Forum Posts by: Tami Brooks

Hello!  Recently I made contact with a property owner I had been searching for quite some time now.  The property is vacant with almost 20k in delinquent taxes (in tax sell status).  She is in the hospital recovering from a surgery and does not live in the property.  She is interested in selling and gave me an amount she wished to make from the sell.  I set an appointment to me with her with my offer after I conducted my due diligence.  I found in 2008-2009 she did a reverse mortgage and the amount recorded is 200k which is way more than what the property is worth.  I now know that loan companies record 1 1/2 times the amount borrowed for these types of loans.

During my appointment with the owner I asked her about the loan details, payoff, etc. She stated that she had not received a statement in over a year and that to her recollection the last statement amount was for only 25k. I will not be able to meet with her again for another week in hope to see the loan documents and hopefully a recent loan statement. My concern is that the ARV for this home is 105k and from other posts I read many times these types of loans require to you to pay up to 95k of value. The house is vacant, needs repairs, and has delinquent taxes.

If there is anyone that has encountered this type of scenario please advise.

I make an effort daily to learn something new and sharpen my skills to advance my wholesale business. However when it comes to figuring comps, assignment fees, etc, I still have a lot to learn. Recently I encountered a possible deal and not sure if my numbers are correct. There are three houses involved but I will share one just to see if I am accurate with my numbers. The house has been sitting up for many years and is currently in probate and the process should be completed in approximately 2 more months. I estimate the ARV @ 105k. I had a contractor come out and give me a repair estimate and he said 40-45k. After using the 70% formula and deducting the repair cost @ 40k I am at 33k. Now from this amount I still need to get an assignment fee and be able to give the owner a offer. They owe a little under 10k in back taxes and I am sure there are code enforcement fines as well. Initially my thoughts were to decrease the repair cost estimate I received from the contractor by 10k then recalculate the value. All comments and feed back are much needed!

Thank you Kellum Lewis.  I was unsure if the assignment would be sufficient or not when finding my end buyer but now you have clarified that it is.  

Seasoned investors/wholesalers please assist! I am in the state of California and I need clarification on wholesaling.  When I have signed a contract with my seller and found a buyer to assign my contract to.  Is an assignment of contract document enough or should I draft an actual contract with my buyer plus have he/she sign the an assignment of contract?  

Thanks guys for all the much needed feedback. It really helped!

Devon - the areas of these vacant lots are in lower end areas. The average house sells for between 75k - 90k. I also did not ask if there was water and electrical. However I know that this information I can find out. There is no new construction in these areas only rehabbing.

I live in CaliforniaI recently found a seller with tax issues on a few properties. Low and behold the properties that I was inquiring about were all vacant lots (huge oversight on my part). Once I spoke to the seller I was given a additional 4 occupied property addresses to look at.  Three are rented with non paying tenants, the fourth is vacant/boarded with delinquent taxes.  I told the seller up front that I was not accustomed to making blind offers.  After hearing the stories of how bad the tenants are I know there is no way for me to get inside the properties to see the interior unless the seller gets the eviction process going.  However I really want the sells.  So I drove by the properties, did my research on the areas and yes....I went ahead and made blind offers all 58-60% below MV to be safe and explained briefly how I achieved my numbers.  The seller took all the information and then asked what I was offering on the vacant lots.  I told the seller that I had not given them any consideration once I began working on the others.  So now the seller wants me to provide offers for the vacant lots (since that is what I was originally acquiring about), then call back the following day with those offers while the seller considered my offers for the occupied properties. 

I am a new investor and I do not feel comfortable making an offer on vacant lots nor am I confident that I will be able to sell them.  Any feedback will be appreciated.