I met an investor who is selling a three family house in an ok area, i asked him about seller financing and terms/conditions, he seemed to have no clue what i was talking about, so im assuming he doesn't have much experience, he told me he just bought the house. At the end of the conversation he is not willing to do owner financing. He offered to finance 20% if i come up with the other 80%. He lives outside of the area and wants to sell asap.
I am interested in the property which is being sold for 80k, but I don't have that 80% he's asking for. I have heard that banks are not doing those kind of deals anymore, even though I have good credit and steady income from my full time job. I was wondering if it would be a good idea to try to find an investor to wholesale the property to and make few bucks. I have no clue how to go about it though. Any thoughts?! Thanks
If you have good credit, good income, and 20-25% down, you should be able to get a bank loan for this property. Now, you probably cannot get a 80% loan from a bank plus 20% from the seller and buy it with none of your own money. The bank won't allow that.
First question for a possible wholesale deal would be what's it really worth? Second question is how much rehab is needed?
There are certain steps that need to be observed in all that we do in life if we are to achieve results! If you want to buy property, please secure financing prior to going out and looking for deals. If you want to wholesale, make the contacts first. Whenever you put the cart before the horse, you will end up just like the “investor” who needs to sell ASAP.
Thanks for your reply. 1 out of the three units is vacant, the other two are occupied with long term tenants. the vacant unit needs paint and minimal cosmetic work. I found two comps within a mile one going for 140k and the other one for 145k. Now those are for sale, so i don't know if they could be used as a comp since they're not sold yet
Hello Ben thanks for you reply. I completely agree with you. Im just starting and i didn't look for the deal, a friend of mind got me in contact with the property owner, and because I don't have financing in place my first question to the owner was if he did owner financing.
I am wondering why he would be selling if he just bought it. Is he a flipper/wholesaler himself?
Also you mentioned other homes for sale, but those can't be used as comps. Asking prices don't mean much at all and are never used for comps. Comps are recent sales of comparable properties in the same area.
As that is a good suggestion to secure financing prior to purchasing then you can prove that you have the ability to purchase.
@Indra H. you are right in questioning if these would be considered comps. Find sold properties for comps.
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