All Forum Posts by: Justin Nothem

Hello,

I was wondering if someone had some insight on how to fill out a purchase option agreement. The agreement I am using is WB-24 and can be found online. I have most of it filled out. There are just a few areas that I don't understand. 

Best Regards,

Justin 

I just want to be clear about the property I am interested in buying. The credit from not knowing one of the student loans was there is an issue when obtaining a mortgage. What made me so interested in the proposed deal is that his ONLY option to sell is through seller financing. In the past, no one has been able to get a mortgage on the place with the condition it is in. He gutted most of the place, then moved up north, and does not want to travel back to finish it. Even if I qualify for getting an FHA loan, I don't believe I would be able to use it to purchase this property. The seller is sort of in a pickle because is options of selling are very limited.

Wow! This is all really great advice.... I have some more information on details.... We have done two walk-through's now... The first walk through we took as many pictures as possible. 2nd walkthrough, I brought my father along, who is no contractor, but has done many side jobs before. My father suggests bringing a plumber and electrician in to get more accurate estimates. That being said, we generated some very rough estimates. Our list is as follows:

Electric - $5,000

Plumbing - $5,000

Drywall - $3,000

Roof - $3,000

Flooring - $4,000

Paint - $1,000

Stain for wrap around deck - $200

Trim - $2,000

Bathroom floors - $300

Counter tops upstairs - $1000

Light Fixtures - $600

Electric Heater Units - $250

Electrical Hardware - $200

Shower - $400

Plumbing Fixtures - $200

Downstairs oven - $500

Sinks/Vanities Bathroom - $600

Dumpster - $400

Medicine Cabinets - $200

Unplanned Labor - $5,000

This totals $32,850. Lets round up to $40,000 to be safe. These are obviously rough numbers. So far I am gathering that we should get a 30% return on the investment. The RE Agent emailed me and said he only had 3 duplexes that he sold in the area in the past year because most people are buying single family homes. The duplexes sold for $165k, $135k, and $140k. I personally believe this one would sell for a little bit less due to the area it is located in. The seller is asking 80k. This would mean 120k would go in all said and done. We would need to sell for $156k to make it worth while. I figure offer $60k. We would have $100k in after all said and done. If we sold it for $130k we would be right where we wanted.

Is my logic correct. sorry for the long post... this is my first time trying to hash this out. Thanks!

Thanks for the advice everyone! Megan and I will be walking through the house next week. Besides the electrical, most of the repair work we should be able to do ourselves or are friends with someone who can help us. I was told that houses of similar size in the area are going for about 140k. We just need to figure out what the repair costs will be.

Hello Everyone,

I am looking for some advice on how to proceed with my first home purchase.

My girlfriend and I are looking to purchase a duplex in Wisconsin. I graduated from college in May of 2012. I pay all of my bills on time. However, there was a student loan that was out there that I didn't know about that I wasn't paying on. As a result my credit when from mid 700's to much lower. It would be difficult for me to get a loan.

We recently came across a duplex for sale. The owner rented it out for many years. He decided if he were to gut it and remodel, he could get more for rent. After he gutted the place, his wife was diagnosed with cancer. He now lives 4 hours away and doesn't have time to fix it up. He also can't sell it because the banks will not give anyone a loan to buy it with the shape it is in.

He is offering the duplex for 82,000 with financing for 6 years at 4%. After 6 years he would expect a balloon payment for the remainder of the cost. I would be responsible for fixing it up. The up and down would rent for about $700 a month each.

Once again this is our first real estate investment. Does anybody have any advice or cautions about moving forward?

Thank you

Hey everyone! I am excited to be here. My name is Justin Nothem from West Bend, WI. I graduated from UW-Whitewater in May of 2012 with a degree in Entrepreneurship. I am currently a registered financial representative with Modern Woodmen of America. I am extremely interested in real estate and am open to any ideas on the best way to get started. This looks like a great community to be a part of!