Motivated seller for sale by owner

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Motivated seller for sale by owner

Daryle Smith
Member since 2018 · 29 posts · 5 votes

Afternoon BP forums, hope everyone enjoyed their thanksgiving.

So I built a good relationship with a seller a for sale by owner and he’s motivated to sell he has taken the deed of a property from his deceased father and is now trying to sell his asking price is 419k he owes 389 on his mortgage so he claims he hasn’t requested a pay of Balance yet so I’m not 100% sure but that’s his word. My offer was 347k but this was before I found out how much is owed on the mortgage. I want to weigh some possible options. Would a short sale be feasible for this situation? And of course if he is ok with walking away with nothing he has been paying the mortgage again so he claims but I can tell from recent discussion he’s rather have peace of mind than hold the property and he isn’t occupying the property either his wife and him make good money he his retired and wife is in the medical field and both have primary homes. What are some of my options if I introduce the short sale option?

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Marc Winter
Real Estate Broker · Northeast PA · Member since 2017 · 2k+ posts · 2k+ votes
6y

If you were to own this property, what would you do with it? What are the monthly total expenses, PITI plus reserves? Would it cash-flow?

If there is some cash flow and you are comfortable, maybe take the property 'subject-to' the existing loan.  

Short sales normally dont get considered by the lender unless the loan is behind/in default.

Good luck.

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  • Marc Winter
    Real Estate Broker · Northeast PA · Member since 2017 · 2k+ posts · 2k+ votes
    6y

    If you were to own this property, what would you do with it? What are the monthly total expenses, PITI plus reserves? Would it cash-flow?

    If there is some cash flow and you are comfortable, maybe take the property 'subject-to' the existing loan.  

    Short sales normally dont get considered by the lender unless the loan is behind/in default.

    Good luck.

    1Reply
  • Daryle Smith
    OP
    Member since 2018 · 29 posts · 5 votes
    6y

    @Marc Winter thanks for replying. He says 2k a month. The house is very outdated but with so much potential. Fixed up it would cash flow it’s not move in ready. How would sub-to work?

    0Reply
  • Kevin Sobilo
    Realtor · Hanover Twp, PA · Member since 2018 · 3k+ posts · 3k+ votes
    6y

    @Daryle Smith, it sounds like the house might still be part of his father's estate and that the mortgage on the house was his father's mortgage.

    I would ask about this. If so, the financial status of the estate might dictate how to proceed.

    If the estate has money, your low offer could be accepted and the estate can pay off the difference for the mortgage at closing.

    If the estate does not have money, then the estate could contact the lender about a short sale. However, if that is the case a lender would certainly want the property to be listed with an agent so that the property could bring the best offer possible. Even a lender who accepts that they will have to lose money would very much like to lose less money if possible.

    0Reply
  • Daryle Smith
    OP
    Member since 2018 · 29 posts · 5 votes
    6y

    @Kevin Sobilo appreciate your response, yeah I would have to ask he says he went through all the paperwork and legal side of obtaining the deed. What should I ask so that I don’t seem confused or I don’t know what I’m talking about.

    0Reply
  • Brett Goldsmith
    Investor · Los Angeles, CA · Member since 2012 · 1k+ posts · 500 votes
    6y

    Did this go through probate? Does he have executorship of the estate? Short sales with deceased borrowers often require this. Sounds like it is a short sale if real estate agents are involved and after closing costs. @Daryle Smith

    0Reply
  • Daryle Smith
    OP
    Member since 2018 · 29 posts · 5 votes
    6y

    @Brett Goldsmith appreciate your response brother. According to him he went through the legal paperwork side to acquire the deed of it was done through probably I’m not sure. Is that something I should ask?

    0Reply
  • Brett Goldsmith
    Investor · Los Angeles, CA · Member since 2012 · 1k+ posts · 500 votes
    6y

    @Daryle Smith Yes, you should know if it went through probate and if he's the executor of the estate ( if the house was in a trust then this may not of been necessary ) 

    0Reply
  • Ola Dantis
    Multifamily Syndicator · Houston, TX · Member since 2016 · 1k+ posts · 2k+ votes
    6y

    @Daryle Smith If the son has gone through the proper probate process to obtain the deed then you could simply offer Seller Financing by taking over the existing mortgage with a balloon payment in say year 2 or year 5 depending on how you structure the deal. 

    I have a Seller Financing template I've used to close deals effectively. PM me if you need it. 

    0Reply
  • Dennis M.
    Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
    6y

    What could you rent it for ??? Highly doubt this is a good investment . Sounds like a dud 

    0Reply
  • Daryle Smith
    OP
    Member since 2018 · 29 posts · 5 votes
    6y

    @Ola Dantis absolutely brother we can connect

    1Reply
  • Floyd Bristol
    New to Real Estate · Jacksonville, FL · Member since 2017 · 6 posts · 2 votes
    6y

    @Ola Dantis

    Hi, Ola. Seller financing is great.

    1Reply
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