I have a question for everyone. I'm about to put a property under contract, and the original owner is in a sticky situation with the county. He have permits to work on the house, and the work is about 85% completed. Unfortunately, his health is deteriorating, and he can't complete the house. The city is charging him 25 dollars a day because the house is not completed. Apparently, this lien is transferred to the new owner. Once the property is completed the new owner can have the city verified the work is done and ask for a hearing to request a settlement of the lien. The settlement is usually around 30% of the total amount due. I'm a wholesaler. How the heck do I explain this to my end buyer? Have anyone come across something similar? All responses are greatly appreciated.
I think you just tell them honestly about the situation and someone will eventually bite.
Most experienced investors/rehabbers will have experience with negotiating code enforcement liens.
Thank you gentlemen. West Palm is actually my home town. I have family that lives off Congress ave. The house is two stories, 1800 SQ FT, with a beautiful lake view. ARV is 120K, to finish the property we're looking at 15K. The accumulated lien is 17K currently, with the prospect once the property is completed it gets settled for around 6500K. We've agreed on a purchase price of 38,500K. My primary concern is the lien as you can see. My other concern is the fact the house is located in a small town. It would be a dream winter oasis for a northerner. But I'm not sure how enthusiastic my end buyers will be about this because of the lien and location.
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