2bd Condo $5000 Need Advice!
Here is what I am working with, the owner who lives in a different state owns this condo free and clear but owes about 4000-5000 in back HOA fees.
The condo needs about 1500 - $2000 in work. He says as soon as the back hoa fees are paid I own the condo free and clear it is worth on Zillow about 60k. The other ones in the complex have sold for about 15k recently, but thats ok just looking for the equity and ownership.
Its a really nice secure location and gated in a good area. He will take 450/mo to pay for the HOA fees, taxes and the back HOA fees. As soon as those are paid The Condo is mine free and clear.
I will live in it, to save expenses.
My question is after I get this in writing and I have it on paper can I go to the HOA and renegotiate the back HOA fees? Any input would be fabulous.
Thank you, Thank you :D
You could ask if they prefer payments or a cash discount. Not seeing that you have any leverage though.
Our association has discounted dues but usually for a sale to get some money as opposed to none through BK.
I would negotiate a Full CASH Offer they might take 60%-75% of whats owed or maybe even lower just to get the balance paid off.
If you think about it you might realize that the money you pay the association will help you, after all the bills they pay represent your share of expenses, You might also consider volunteering your time to help them turn things around if they have problems.
You might end up with some problems yourself because you now own a proportionate share of everyone elses problems and are owners with partners like the last owner who likes to stiff everyone else expecting others to pay their way.
The first thing to do is to find out the associations position at this time because they may be foreclosing on it. Consider not giving the owner anything as he might just pocket the money and leave you hanging. Any money you pay should probably be deposited in escrow while working with the association to resolve what problems the owner has created.
Are you qualified to understand the financials of this association? You could be jumping onto the Titanic. Check things first as you might regret things later.
Thank you for the responses. A couple more variables.
The guy that I am buying from is setting up an escrow account with the association today. We will be signing paperwork as soon as possible.
He will be paying for the broken front window upfront which I will be getting estimates on. We asked if he could do this because it currently just has a large board on it. We will pay for it on the back end. He said no problem.
This is the third unit in the complex the seller is selling like this, I asked and what I got so far is second hand but I think it kinda of makes sense.
The seller is out of state and the guy that bought the first unit is showing me this property and is like his go between on site, which is no problem he is easy to work with.
The guy that is the liasion told me apparently the Seller got royally screwed here, he bought on the top of the market purchasing all 3 for about 130k each.
The company he bought them through went bankrupt and he had property managers that were not good either. Leaving these 3 units vacant for about 3 years each or some time equivalent.
Usually when these sort of things happen the HOA picks up the tab because the properties are empty encouraging the owner to get people in them or sell them. The HOA didn't do this leaving the Seller screwed again.
After I get all my paperwork signed I want to let the HOA know I am buying the unit and then negotiate the fees down. Is there a certain appraoch I should take?
Will they listen to me on behalf of the current owner?
Or should I hire an attorney for $500 bucks and have him see if he can get it done faster and cheaper? Maybe Prepaid legal?
Any suggestions greatly appreciated.
Thanks
Something sounds screwy here. If I weer in your shoes, I'd get a preliminary title search done for $60 or so... before you put any of your money in. Call it insurance. Hard to believe this guy is really just giving away properties after sinking almost $400K in it.
Jeff and Chris are right on the mark. And I'd be concerned about that "go-between", too.
So they told you of the back hoa fees. Did they tell you about the attorney /collection fees? If that much money is owed, most likely it's been turned over to an attorney for collection. Hoas do not normally reduce the amount due, for any reason, so don't count on it.
At the very least, you need to get, in writing, a statement from the management company, a letter of accounting, as to dues and fines owed, and whether that has been turned over to a collection agency or attorney for collection, as well as whether it's already being foreclosed on.
If it's been turned over to collections or attorney, you need to find out what THEY are charging the owner. Do NOT give any money to the "owner" or his "go-between." Find out the attorney's address, and pay by certified check, in person, and get the receipt marked paid in full--AFTER you own it. No reason to give that seller dude the money! He's likely to skip as he already has.
IF you purchase the place, you need to know even about unpaid utilities, and all the other financials of the hoa--major repairs to the common areas, any lawsuits against it, and everything else you can think of, or get advice about.
Sounds to me like you're being scammed.
I appreciated everybodys input all good stuff.
Is there anybody out there that could review the contract for me and help me make the neccessary adjustments?
Just to make modifications and then I can present it to the Seller.
I hope you did a title search. Regarding "...review the contract for me and help me make the neccessary adjustments..." I would seek an attorney's help. If you use the same attorney firm when you close, they may not charge you for consulting time prior to closing.
It sounds like you are working on a real limited budget. I would try to work out a payment plan directly with the HOA and see if they will allow you to take title and then pay them off. I would not pay this owner directly just offer to take the tile from him so he can walk away from it. I also second the idea of title insurance. You seem to be new at this and operating on a slim budget so you might appear as a target to others. Also do some reading on here about HOAs and what not. If units were selling for the price you stated a few years back and are now selling for 15k I would bet that there are many vacant units and the HOA is not bringing in what they should. HOA is probably unstable and fees may increase substantially. Also dont listen to what this "liaison" is saying. I never heard "Usually when these sort of things happen the HOA picks up the tab because the properties are empty encouraging the owner to get people in them or sell them. The HOA didn't do this leaving the Seller screwed again." Why would the HOA pick up the tab for what the owner is responsible? Never heard of this and seriously doubt its true. If owner doesn't pay the HOA files a lien and may foreclose. The seller didnt get screwed he screwed the HOA.
all done got it done and it is great thank you everybody.
Hi Nick,
I am just curious about how you came accross this condo and I will tell you why I am asking. I live in a community where their is also a association. My neighbor told me last week that a home was foreclosed on because the owner had not paid the association fees for nearly 4 years. Would my association be a good place to look for these kinds of deals? Thanks.
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Real Estate Agent Florida (#SL3435961)
- 4074333402
- https://josephsanchez.hometrustrealtygroup.com/
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Originally posted by Nick Abbate:
all done got it done and it is great thank you everybody.
Did you end up doing a title search?
oK in response to the questions that were asked.
Did I do a title search - I did a preliminary title search in that I checked taxes reacords and according to the actual tax bills the owner gets are different from the actual taxes bills. The tax office has the mistake so we are correcting that with them.
Also confirmed with the HOA about ownership and liens.
After my wife and I moved in we had a full blown meeting with the property manager and things have turned around in the entire complex. (2 hours)
The
- pool is now open and being cleaned two times a week
-the whole commom area just got seeded and is starting to grow grass
- the locks for the pool and community have all been changed
- The lights are all getting worked on
- parking and tow away signs have now been posted in spanish and english
Thats just to name a few things.
To answer your question Joe, I came across this deal on Craigslist.org
Your other question would the association be a good place to start yes but you have to make sure you are talking to someone who can actully give you that information, if not it will be public record and maybe you could grab the property at a tax sale just for the past due taxes, who knows you might get lucky.
Regarding "Did I do a title search..." Sounds like the short answer is no. I hope you don't get burned... no one ever gets burned doing deals on craigslist.
Not having dones an indexed search, I'm guessing there's a 'blanket' D-T covering this parcel. For your sake, I hope I'm wrong.