How do you buy out a mortgage from someone without blowing a ton of cash?

5 Replies

I have a friend who currently has a home in Atlanta. He is moving up to the New England area and is trying to get rid of his home. He would like to rent it out but is unsure about how that would work and sounds like he would rather not have the headache at all. Most of the prospective buyers don't like the home because he has an unfinished basement. The basement is pretty much a separate apartment with its own kitchen. So I asked the question can the basement be sealed off and separate from the top, is it above ground basement, etc. it sounds like it could potentially be split into a duplex ... I know most people are like don't ever try to rent out the basement. I haven't seen the hard data on the house as of yet. I told him to bring me the data so I could look over it and see what the best plan of action is. What would you do in my shoes? Would you try to take over the mortgage? Refi? Leave it alone? Fix and flip? Convert to over under duplex?

Your subject line and post don't seem to be related.  What's the question related to your subject line.

Lots of illegal duplexes around here.  Just like you describe.  If you want to do it legally, there's a process that involves the city planning/zoning comission (are duplexes even allowed) and building department (codes for duplexes.)  The biggest issue you often hit with a basement unit is egress.  You often have to convert windows to meet current codes for egress.

Originally posted by @Jon Holdman :

...

The biggest issue you often hit with a basement unit is egress.  You often have to convert windows to meet current codes for egress.

 That and fire-rating the ceiling and common walls between the basement {accessory} apartment and the main house.  This includes fire calking or collaring all plumbing, electrical and HVAC runs which transition between spaces.   In some jurisdictions a common mechanical room needs to be fire separated from the remainder of the building depending on the fuel source used for heating.

Good to know.  I was just thinking and trying to figure out what to do with this thing and I wasn't sure if that type of "duplex" was legal or normal or whatnot.  I asked him to bring me the paperwork on the house so I can crunch the numbers to see if it is worth buying and holding or maybe even flipping.  Either way the basement needs to be finished in order for it to sell (supposedly).  Also need to find out what he is wanting out of the property.  If it is something I could hold I would think about it if the price was right but I am guessing it is not going to be.  As far as flipping I need to gather the info about the comps there and see what it is listing for now as opposed to what a finished basement would bring the price to.  I have the newbie itch and everything looks like a potential deal.  I know that if the numbers dont add up there is no need in even worrying about it though.  I guess the bottom line is trying to figure out how to fix this guys dilemma as well as learn something in the process.  If I made a couple bucks on the deal or broke even that would also be ok.

@Jon Holdman

@John McConnell

To John McConnell, I agree with Jon Holdman.  Your post title asks about a mortgage but your content is asking about a basement duplex.

I'm confused???

Sorry. didn't mean to be confusing.  I am actually still waiting to get some more details.  But other than mentioning the basement thing... Im pretty much asking what the topic is about..  and I guess I have answered my own question that I really have to see the data before making any assumptions about anything.

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