Creative finance with 50k equity and $400 a month cash flow Alabama
First good creative finance deal in negotiation! Seller needs some equity to pay medical bills. I don't have all the capital and now have to find a $ partner.
Comps and lender appraisal puts property at 218k(1 month ago) Alabama market doesn't shift, slow and steady.
Seller put 30k into it when he bought it in 2013 for 199k. Still in great condition with tenants in place.
Mortgage fixed at 3.375% and they payed the not down to 120k.
Seller will keep financing in place for 45k cash.
Tenant in place paying 1250 a month, they cover utilities. Mortgage payment is 837 a month. Lease ends in October and tenant will be moving out.
50k in equity on the table and cash flowing at $400 a month.
Downsides:
house built in 1900 and on 2 acres in the "country". Just on the outskirts of town. Plenty of homes around, but everything gets a bit spread out. Right off the old highway. 5 bed/3 bath, 3 fireplaces, big parking lot. storage shed.
My first plan is to find a money partner and have him put up the funds. Split cashflow and resale 50/50. I have my license so It can be listed in the MLS and only pay the 3% plus closing. I am a buy and hold investor, so I would prefer to sit on it. Not sure on the vacancy factor due to its location.
Another Idea would be to take a hard money loan for the 45k. I have a lender that will do 12% and 4 points, problem is I don't have a track record to bring him. The tenants could possible move out early, I know where they want to move to and are committed to moving.
Any other Thoughts and Ideas?? What Else am I missing? Thanks all!!