I'm looking at a property that has not been managed great. This is good because it provides the opportunity I'm looking for. But it is bad because the guy who owns it can't seem to be able to provide the information I'm looking for (rent rolls, expenses, copy of leases, etc...).
I'm brand new, this would be my first deal. On the one hand I want to stay away. I'm nervous anyway being my first one, and he's not providing all the info I want (at least not yet).
On the other hand I can understand that he is in over his head, he doesn't keep good records, and thus he wants out (good for me, he's selling at a reasonable price).
Looking for guidance, how do you determine whether a deal is just poor management and record keeping, or if he's trying to hide something?
I think you should assume he's hiding something. The rule of thumb is to trust but verify. If you can't verify, at the sellers expense, then you'll have to lower any offer price. You need to be upfront and say 'don't have all the information available. Because of the records provided I can only come up to $XXXX.XX for my offer.' It might be a great deal. If he/she's not interested then move on.
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