Newbie needs help with 1st Deal

7 Replies

Hello!  My name is Melissa and I live in the Fingerlakes of CNY. I've been interested in RE for a long time and would like to get started investing.  I have found a house that is abandoned in my town that could be a deal, maybe.  In my sleuthing I found out who owns the property, she is a 90 yr old woman who lives in another town nearby.  She is the only name on the tax records, it looks like she has owned it for a very long time.  She has paid her property taxes on time, except in the last year, she was late on the payments.

I would like to mail her a yellow letter. Here is my question, what if she calls me? Then I am not sure of the process....do I use my RE broker? Do I offer a cash deal (with the help of title company and attorney) w/o a broker? What is the process?

The house needs a lot of work, but I am not sure how much.  I'd like to get inside to see it.  How do I go about this?

@Melissa Tompkins-Stahl Ok thats a lot of questions lol. First, if you send a letter and she calls you thats great. Second, I would consider maybe just driving and knocking on her door and letting her know you are interested in buying the house she owns. As for getting an agent involved, it depends on what your exit strategy is and how comfortable you are filling out a contract and getting the deal closed on your own. I would definitely suggest that you run comps and determine what you could reasonably pay for the property. Then determine exit strategy and financing.

@Lydia T. Thank you. The house is in such bad repair I would offer $25,000 or so. It needs a lot of work, it's an old beautiful home. From what I am seeing in the market, the ARV could be as much as $180,000. Because I have not been inside, I'm not sure of the rehab cost. My guess would be a total gut so rehab cost could run high.

It's a 4 bedroom 1 bath. I'd like to turn it into a duplex, adding another kitchen and bath.  2 bedroom 1 bath rentals go for about $1200. Even considering our high taxes in NYS, I can make $2400 before expenses work. 

I guess it's the negotiation part I'm unsure of.  I will dig deeper. J Scott has a negotiating  RE book I will read. I also have a friend who invests in multi family houses I can ask advice from. 

Once I have one of these under my belt, it won't be so confusing, I'm sure . But the first is nerve wracking!

@Melissa Tompkins-Stahl Dont drag your feet. Deals dont wait for you to be ready for them. If you want a good way to practice, call FSBOs from Zillow and practice asking questions about their houses and negotiating on price. You have to get comfortable and confident doing talking to sellers