Hello BP family,
I ran into a situation that may be a deal, but I'm not sure. I need your opinion on what my options are?
Subject: 4br /2ba townhome in Lauderdale Lakes Fl. The estimated market value is $120,000, minor repairs need.
Owner: She owes $90,000 on the mortgage, she rents it out for $1600 and has a cash flow of $445.
Situation: The owner is going through personal issues and no longer wants the property. She said she would get rid of the property for $10,000-$15,000. She needs that money to move out of state and start over again.
Question and/or advice: Is this a wholesaling, buy and hold or flipping opportunity or is this a flop? Thank you in advance.
That depends--what do you want to do with the house?
Not much there for a flip, but sounds like a subject-to deal you could keep for yourself or wholesale to an investor.
@Nicole Heasley was hoping it was a deal of some sort. I would either hold it and continue renting it out or wholesale it.
@Jeff Morelock do you know how I could negotiate a "subject to deal" with the seller and give her the $10-15k she wants?
I have townhouses that do not have an HOA fee, but most do. What about this one?
My first impulse is if you can get it for $100k and rent it for $1600, then it seems like a good deal on the surface. Obviously, you need to do an in depth analysis to really have a better idea.
Do you have the $10-15K? That would be the first step. As far as subject-to negations there are whole courses, books, and podcasts here you'd have to read and or take. They are not the easiest deals to get done and/or wholesale.
At first glance, it looks like it could be a deal. I like a gross rent multiplier (GRM) of 8 or less. That means that a $100k unit should gross about $1000 / month. From a cash flow perspective, it looks like it could be a good income property. I'm a little unclear on the details of the transaction. Are you buying it for $105k and assuming the loan? Or, will you be paying more than that to cover transaction costs?
@Dustin Beam yes, the HOA is about $250 a month and the monthly rent is $1600
@Jeff Morelock , I do not have $15,000, but if the deal was good, I would find it. Like you said, I've been reading about subject to and learning a lot. I also found out that her name is on the deed, but not on the mortgage. There is a lot of moving parts and I need to know what I'm doing.
@Rhonda Wilson I was not sure at first, but now I'm leaning to doing a subject to.
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