Property in Preforeclosure with lots of EQUITY!

To get to the point quickly... If you list it for 500k and sold it for that amount... pay a Realtor commission and closing costs again... and pay say 3-6 months of holding costs, mortgage, taxes and insurance... you would lose 10k-15k.

Something has to change... Also need to get exact with the numers...

Guesstimates = No Money...
No money = Bad

Edited: 06/26/2010 at 04:32AM

Arnold Camps

Residential Real Estate Broker · Seattle, Washington

119 posts
333 Influence
2 Awards

Icon_minipost Jan 18 '08, 07:14 AM

Thanks Eric for your Advice.

We're going to wholesale the deal. We're going to redo our numbers so we can make a conservative spread and also get our investor a deal too.

Edited: 06/26/2010 at 04:32AM

Eric Foster

Real Estate Investor · Portland, Oregon

1128 posts
195 Influence
3 Awards

Icon_minipost Jan 18 '08, 08:11 AM

An investor buying it wholesale will do the same "quick math" and come back with a quick " No" as their answer...

Rework the numbers... i.e. Offer less, reduce costs to rehab, sell to end user, etc

Edited: 06/26/2010 at 04:32AM

John Michailidis, Esq.

Real Estate Coach · Sarasota, Florida

39 posts
33 Influence

Icon_minipost Jan 18 '08, 08:23 AM

Originally posted by "EricFoster"

Guesstimates = No Money... No money = Bad

:lol: Ha! Truer words of genius have never been spoken . . . I bow down before you!

Edited: 06/26/2010 at 04:32AM

Nunya Bidness

Banker · MD

29 posts

Icon_minipost Feb 11 '08, 09:03 PM

Originally posted by "seattlegogetter"

Loan Payoff is Est. $282,201.33 Total all fee's

Seller wants 350k for the property (still not executed)

Repairs & Rehab is 90-110k guesstimates

The Home is 800sqft on a 5000 Sq ft lot.

If I can provide anything else let me know, Thanks for all your advice everyone

First - get REAL estimates.

Second - it's too tight if those estimates are correct or close. You'll lose money unless you can purchase for closer to 300k.

Edited: 06/26/2010 at 04:41AM

Jon Holdman

Real Estate Investor · Denver, Colorado

11856 posts
75505 Influence
15 Awards

Icon_minipost Feb 11 '08, 11:06 PM

Its worth $450K and needs $100K of work, right? And you're going to wholesale it, so you want a cut and still leave enough profit for your end buyer. I think you need to be closer to $225K on the purchase price.

I have other posts where I break this out in more detail. But, if a rehabber buys a house and has rehab costs that come up to 70% of the final sales price, do it in six months, use hard money and some of their own for the deal, they will stand to make about 12% of the selling price after the closing costs on both ends and the holding costs. That's about $55K in this case. If you buy for $300K and flip it for, say, $310, the rehabber is going to lose money.

At $350K like the seller wants, there's no deal. $350K + $100K rehab = $450. You lose all the costs, which in this case is going to be something like $60-70K.

Jon

Edited: 06/26/2010 at 04:41AM

Jon Holdman, Flying Phoenix LLC

Arnold Camps

Residential Real Estate Broker · Seattle, Washington

119 posts
333 Influence
2 Awards

Icon_minipost Feb 12 '08, 12:02 AM

Thanks everyone!

Recently I got the seller to agree to 325k with 285k in arrears.

I have a buyer for retail buyer for 365k.

I want to flip this property with a vehicle. Would I consider an Option or a Land Trust? There's a problem that might come up as I'm a licensed agent.

Thanks Everyone!

Edited: 06/26/2010 at 04:41AM

John M.

Real Estate Investor · Rancho Cucamonga, California

78 posts
8 Influence
1 Award

Icon_minipost Feb 12 '08, 12:51 AM

hey seattle,

so how much would you get out of this deal (if you haven't already provided the numbers)? Is it a simple subtraction of the your buyer's offer and the purchase price?

Edited: 06/26/2010 at 04:41AM

Arnold Camps

Residential Real Estate Broker · Seattle, Washington

119 posts
333 Influence
2 Awards

Icon_minipost Feb 12 '08, 12:57 AM

Yeah simple subtraction, 40k estimate

I'm a real estate agent too so I just found out that we have a form that the mls provides with an Option Form

Edited: 06/26/2010 at 04:41AM

Arnold Camps

Residential Real Estate Broker · Seattle, Washington

119 posts
333 Influence
2 Awards

Icon_minipost Feb 17 '08, 12:38 PM

Thanks for all of your advice members.

Edited: 06/26/2010 at 04:43AM by Arnold Camps

Eric Foster

Real Estate Investor · Portland, Oregon

1128 posts
195 Influence
3 Awards

Icon_minipost Feb 18 '08, 03:36 AM

Glad to hear it worked out!

Edited: 06/26/2010 at 04:43AM