Good Evening BP Nation,
I have a potential opportunity to put together a deal but am not exactly sure how to proceed.
Situation: My mother-in-law owns a house in the Point Breeze neighborhood in Philadelphia. There is no mortgage on the property and she will literally give it to my wife and I to do what we want with it. However, she hasn't lived in the house in 10 years and it is probably just a shell at this point (we are getting someone to go and take pictures of the property this weekend since we live out of state). I've checked the county records and know that she owes 6K in back taxes. There are probably gas and water liens to go along with the property liens. The ARV for that area is 75K and it could rent for 1K a month.
I would like to either 1) wholesale the property 2) flip it or 3) rent the property (my least preferred exit strategy). My primary objective would be to control the property (FSBO?) without paying money out of pocket and sell to another investor who can then flip it or do a buy and hold. However, if I can make considerably more money by flipping it myself then I would do so. If I did decide to flip it, how could I do so and avoid paying all of the taxes and liens on the front end? If you were me, what kind of deal would you put together? I look forward to your feedback. Thank you and God bless.
Get your mother-in-law to put the house in a trust, with you as the executor. Transferring property to a trust tends not to trigger payments due to creditors.
Although you very well might be able to transfer title without the liens coming due, depends on the specific Philly laws
You could sell it traditionally and pay the back taxes and liens at settlement.
If it were me...
I'd consider my time, interest, and status of the debts. Then I would work out the financials for the following options:
- Wholesale it as is
- Partner with someone who has boots on the ground and manages the flip
- Partner with someone who has boots on the ground to rehab and then hold
- List the property with a Realtor and try to get retail value
If you are planning to flip it, then I would pay the taxes/liens up front or at least contact the agencies and get (IN WRITING) confirmation that they will not force a sale for x amount of time (I'm not certain this would be possible and seems like too much headache). I'm sure someone else can add clarity to this option.
Point breeze is my backyard. I live very close to the area. If you need any help with something let me know, I will do my best
I am a heavy investor in the Point breeze area of Philadelphia. If you message me an address I will be able to give you numbers instantly.
I invest in the point breeze area, I would be interested in buyer or partnering with you if its a good deal. Inbox me if you are interested.
I would offer to list it, but it looks like you could have plenty of buyers here. Lol
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.