Need Advice on How to Structure a Deal
Sorry for the length but I appreciate all that read it. I currently have four rentals. While in the process of leasing one, a 69 year old lady completed an application for the house. After reviewing her application and background check (she has a clean background) I noticed that she currently resides in a house that she is buying and has lived in for 12 years. I asked her why she wants to rent when she has a house. She informs me that her husband passed away and she no longer wants the responsibility of home ownership. She says she just wants to walk away and let the bank have it plus the house will need a new roof in a few years and she does not want to put any money into the house. She is current on the payments. So after some talking I go over and look at her house. It is very well taken care of, and clean, and landscaped, and her pride of ownership shows. Its in a good strong neighborhood in a good area of town. It could use new carpet and the AC is on its last leg but for a few thousand the house could be ready to sell. The retail value would be 118k - 122k. She said her loan amount is 86k and some change. There is not a ton of room in the deal but I think it is enough to do something with. With that in mind I am asking anyone that reads this what strategy I could use to acquire the house and sell it, or keep it, or whatever. My position is I dont have enough in reserves to qualify for another mortgage since I currently have five mortgages (basically I need about 28k in reserves and a little more for a soft rehab and closing costs to buy it with financing, I have about 18k liquid.). The only strategy that I am familar with is buying houses at steep discounts, rehabbing and keeping as rentals. I have no experience with wholesaling, or subject-to, or really even doing fast flips. As stated earlier the immediate rehab costs would be less than 5k. So basically I wanted to get anyone's input on how to best handle this situation. She informed me that her bank told her that if she knows anyone that would want to take over the loan they should call and talk to the bank. I plan to call the bank tomorrow. All I can really think of is trying my hand at my first wholesale deal.