Investor · Atlanta, GA · Member since 2015 · 12 posts · 1 vote
I am currently working on a project in which the seller has agreed to sell me his property at a substantial discount, the only thing is that he is in the process of moving his stuff out the property and needs some assistance. Initially, it was a Uhaul ($250-300) rental, but now he is looking into acquiring a trailer ($5K) due to the volume of stuff that he has (hoarder). He is asking me to front the bill, which I have no problems with as it is with the understanding that any assistance will come off of the purchase price. Ideally, I wouldn't mind putting in $250-500 with the understanding that it is to be repaid if and for whatever reason we do not close. My question is how can I structure the remaining $4500 so that it is not paid out of my pocket and is paid at closing?
Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes
10y
@Account Closed,
I don't think I would do that - too easy for the seller to back out and leave you holding the bag.
Talk to your RE attorney and see if there might be someway to still help the seller while placing a lien on the property so it needs to be satisfied at closing. Trouble there is you're getting your own money "back" - not really, you're actually paying TWICE! Once up front, then again at closing.
Rental Property Investor · Weehawken, NJ · Member since 2014 · 1k+ posts · 704 votes
10y
@Account Closed
I would keep your money out of the trailer. If he is hard up, I would encourage him to seek another private loan via Lending Club or even an interest-free credit card (for a few months). You pay full price, still, but now you are not involved with his increasing moving costs. This sounds like a pretty typical case of "Oh, and I forgot... new charge."
Excellent advice gentlemen. After further consultation, I've decided to hold off any moving activities until after closing. I really wanted him to be out of the property before we closed so that I didn't waste any time getting started. However, putting up money without a sure means of recourse would be foolish and going through additional channels to ensure recourse would be time intensive and expensive. I'm just going to wait until the closing. Again, thank you for your insight.
Rental Property Investor · Weehawken, NJ · Member since 2014 · 1k+ posts · 704 votes
10y
@Account Closed
Your average homeowner keeps very close ties between their home and their personal life. It's hard to get them to understand that as investors, we aim for the exact opposite.
Since you have a vision for the cluttered home, I am sure it will turn out to be a great value-add. Just don't take the bait when these owners ask you to get involved in their moving issues. Same goes for tenants, as you can imagine.
Rock Hill, SC · Member since 2015 · 1k+ posts · 597 votes
10y
Originally posted by @Account Closed:
I am currently working on a project in which the seller has agreed to sell me his property at a substantial discount, the only thing is that he is in the process of moving his stuff out the property and needs some assistance. Initially, it was a Uhaul ($250-300) rental, but now he is looking into acquiring a trailer ($5K) due to the volume of stuff that he has (hoarder). He is asking me to front the bill, which I have no problems with as it is with the understanding that any assistance will come off of the purchase price. Ideally, I wouldn't mind putting in $250-500 with the understanding that it is to be repaid if and for whatever reason we do not close. My question is how can I structure the remaining $4500 so that it is not paid out of my pocket and is paid at closing?
Any advice is sincerely appreciated.
I would like everything in writing but some thing not sounding right.
Get a lawyer to draw this up and make sure every little detail is in their.
Norfolk, VA · Member since 2015 · 6 posts · 0 votes
10y
i if your buying the trailer for his's usage put lean on the title of the trailer yuou as buyer .. if he dose not pay you back , clamed your trailer , was taking from your property . but make shore your name is the main person on the title .. when there finished sale the title of the trailer to them . or get a written agreement , too that him as the original property owner with deduct the value from THERE CLOSING COST. as a contigancy for closing of sale. (place a lean on the amount of vaule of traler))
Do nothing but be carful. I have seen these move out situations drag on for months after closing only to end up having to evict and pay to dispose of all the owners junk. This guy will not be easy to get rid of.
Hopefully you build in a contingency for that happening.
Investor · Atlanta, GA · Member since 2015 · 12 posts · 1 vote
10y
Thanks, @Vincent Garcia and @Thomas S. I decided to hold off on anything until we closed on the property. I gave him his options and he decided that he'd rather have his money and use it as he saw fit with regard to the move.