Exit strategy for Subject to agreement
So I have a deal that I am evaluating. The owner just wants out of the property and wants what he owes on the mortgage. (35k) The property is worth about $65-70K fixed up. I need to put about $25k into repairs. I cant offer him 35K with the 25K rehab and make any money on this deal. So what I have proposed to him is that he could deed the home to me subject to the existing mortgage in place. I would take over the payments and put in the 25k in repairs and rent it out.
My question is that once I have rehabbed the property and installed a new tenant, can i then go to a lender and refi the mortgage at 75-80% of the new value? Eccentially cashing out my investment and paying off the existing mortgage?
Have at it BP'ers, you always come up with the best advice.
Regards,
Marlon Long