I have a house in North Carolina that I have flipped. I purchased the Property January for $220,000 with a combination of hard Money 198,000 @ 9.5% + 2 pts.
I have a private money loan @ 60,000 @ 8%. The property was finished and listed in March for 369,000 have dropped the price monthly and I am now at 320,000. My issue is my hard money loan comes Due September 12 or goes to 26% interest. Is there any thing I can do to get out of the hard money loan before I get killed with Interest. My payments are $1,560 a month (interest only) I do not have a problem making the payments now .The Private money loan is not a big deal it is a friend of mine and does other flips with me. I can not go to traditional lending to get a loan. The Property is at 1948 Cornerstone Dr Winterville NC 28590 if someone wants to check it out. Any Advice will be appreciated. I am running out of time and the noose is tightening.
Why not price it correctly and get it sold?
We're at that time of the year where prices are going to be decreasing over the next few months, not increasing.
@Emmit Giddings I have to agree with @J Scott . You either did not price it correctly or the work you did to the property is not in line with the comps in the area. Lowering the price that much means you missed the mark on your comps. We generally have a slow down this time of year when people take their summer vacations before kids go back to school. You may have to keep lowering the price.
I looked at your listing on Zillow and have to say it looks beautiful in the pictures. Well done!
That being said, here’s my take:
- you were probably priced too high when you first listed in April. The fact that 2 neighbors are asking $395k and have been on the market for 61 and 117 days speaks volumes.
- you dropped the price 7 times since April. That makes you look desperate not motivated. You go too low and people begin to wonder “what’s wrong with the house?”
- I don’t know the area but you seem to have a lot of competition for sale and most have been on the market a while too, as per my first point. For example, there is a 5/3 3000sqft home on Baywood asking $249k in move-in condition and it’s been listed for 30 days.
- the schools aren’t rated the greatest and may be limiting your pool of buyers.
There is something with that area that is causing homes to sit in the market. Have you asked your Realtor what feedback has been from prospective buyers? It’s critical to hear that in order to know why it’s not selling.
If it was me, I’d look into making it a rental and refinance it as such ASAP.
I appreciate the input. One of the things that is hurting me is this area behind me just changed High School Districts and a lot of properties in the other neighborhoods have gone on the market. There have been sales in the Neighborhood that are smaller than mine and sold for more per square foot than my property. And sold very quickly . Most of the sold properties in the neighborhood are $120-$125 sf I am at $99sf. The only thing that I can see if my home is much bigger then the ones that sold, maybe it is to big?
I know the area. It's an odd neighborhood. It appeals to seniors with small lots and upscale homes, however, the homes are large (built during the McMansion era) and require upkeep. The homes themselves appeal to large families with kids, but with no yard and a bad school district. What's done is done. Call Homer and ask him for suggestions and to "Get It Sold" like he advertises. He'll probably just suggest you keep lowering the price. One thing I noticed is that the 4 BR's were selling at a premium over the 3 BR's. Is there anyway you can eek out a 4th BR? Heck, with that much sq ftg you should be able to throw a closet somewhere and call it a 4 BR. You put it on the market at the right time, however things do begin to slow during the back to school season as @J Scott and others have stated.
Thanks James, I talked to Homer in the beginning about making the Frog a bedroom and he said it would not make a difference in selling the property.
You take away a big pool of buyers when you list it as a 3BR. Think about how many buyers go to Zillow and put a 4BR in the filter. They never even see that beautiful house. It’s a lovely neighborhood and in a location that’s convenient to everything. That should be in the listing. I know Homer has made a lot of money doing this, but I never like to see “ motivated seller.” First thought is what’s wrong with it? Then I look to see how many days it’s been on the market. Homer is a great salesman face to face, he sold me when I put my personal residence on the market in ‘08. Took him 366 days to sell it. Not bashing him, he’s an ok guy, just comes off a little slick. Hey, it’s your arse on the line, just let him know you aren’t happy. The sold comps in the neighborhood let’s you know there’s a big differenice between 4&3. Good luck. Let me know what you find out.
In the meantime you may want to refi out of that loan If you have over a 650 credit score you can get a stated income loan no financials needed
Great advice so far! Not knowing your full situation is hard to give advice. Usually, if a house is sitting longer on the market then its neighbors its either priced too high or does not have enough exposure. A good tactic I found is calling the agent or agents who have sold houses at the price you're looking to sell in the neighborhood and asking them what they did to market those particular houses.
@Georgui Kasaev not a bad idea. I would do something immediately before school starts back. Drop the price to $309,900 and see if you get multiple offers and put somewhere in listin that “x” room could be used as a 4th BR.
Thank you all for the input. I am talking to Realtor tomorrow. I can add a closet in FROG for 500.00 with out a problem. The stated income loan may be an option if all else fails I have an 820 fico score. Thanks again for all of the advise.
@Emmit Giddings . Another thought. Open house. Couldn’t hurt. DIY if you get desperate. Cheers.