Real Estate Investor · Member since 2011 · 35 posts · 3 votes
I have a lady highly motivated to get her own place, however, she is disabled and lives off a tiny check. She came to me saying she desperately wants to own her own house but can only pay less than $100/mo and she let me know her credit is shot. It will be my job to find her someone willing to owner finance their home to her. So, I need a letter of intent to a home owner willing to finance but my lawyer is confused with my investor talk. How do I ask my lawyer, in legal terms, what kind of contract I need? on top of that, since this lady is broke, how can I make a profit off this deal?
Seriously, she can afford $100 a month. If you take 10% of that you get $120 a year. Does she have $2000 for a down payment on a $20K house? Would you want to keep half of that and give the owner $1000 to the owner? $20K at 5% for 30 years is $107 a month. Who pays taxes, insurance and maintenance? $100 a month will not buy you a place to live, even with properties that cost only $20K.
The town she lives in is very impoverished and standard properties in low income neighborhoods range from $20,000 to $60,000. I was thinking if she could get a 20-30 year term then her payments would be low enough. That just leaves me with, what do i ask for with the lawyer and how do i make a profit?
Seriously, she can afford $100 a month. If you take 10% of that you get $120 a year. Does she have $2000 for a down payment on a $20K house? Would you want to keep half of that and give the owner $1000 to the owner? $20K at 5% for 30 years is $107 a month. Who pays taxes, insurance and maintenance? $100 a month will not buy you a place to live, even with properties that cost only $20K.
This buyer isn't worth the effort. It seems to me like you want a listing agreement. If that is what you want go get your real estate license. You find the real estate product first and then buyers second if you want to execute a subject-to purchase that you sell on terms.
Carlos is right. I bought my rental for 12K cash and my taxes and insurance are about 110/month. That's with cash value insurance and not replacement value to boot.
Maybe you could find an old trailer house or travel trailer and then pose this question to MH investors here on the forum.
The title complany that handled my rental house transaction had a lawyer as a partner and they were very helpful explaining how to do owner financing. The lawyer spoke with me at length on the phone for no charge. Of course, they just helped close a deal with me so they knew I owned a house all cash which I could owner finance. If I was just a dude asking them about it and told them I wanted to accomplish this feat at 100/month, they might not have been very helpful.
BTW, last post of yours I read, you wanted advice on how to get an apartment complex with no more than 50 bucks. I hope you are saving cash during this time that you are trying to get something for nothing. If so, maybe you have 100 dollars in your pocket today :). Chances are that you will save enough cash to actually make a move before you find something for nothing.
But I suppose a blind squirrel can find nut...
BTW, BTW, this woman probable gets a few thousand tax return each year and this is tax season. Maybe you can help her help you..
Short anwser is you don't. Attourneys cost money. Money from the sound of it is something your client dosent have which means its money you wont ever see. So why spend your money on this?
From what your saying its your job to find this lady a house she can afford. That sounds like a realtor, if you are buying a house and then reasigning it to her at closing thats another thing. I think first you need to actualy look at what it costs to own a home in her area including maintance and then compaire it to her $100. Id bet you money this isnt going to happen and is a waste of your time. If when you factor every thing in if it really costs less than $100 and the amount of time it takes you to do this and collect your money each month, do the accounting and taxes then what the heck go for it.
Ok, well, I found a lawyer that speaks real estate lingo. I doubt anyone saw the opportunity which is fine.
The same people post in my topics so I would appreciate that those repeat posters not to get too deep into my deals. Though I have posted questions about getting a 50 dollar appt complex, I would appreciate the skepticism and pessimism kept silent. While people have complained or voiced "you can't do its" I have closed on several deals. Anyways, I am done griping and won't return to view this topic.