Motivated seller, with very light rehab, slight off in price
I have a motivated seller who wants 335k for the property (arv is 400k). The property is honestly in good condition and can be rehabbed in 2 weeks, it just needs a new kitchen and some paint. My problem is how i can structure this deal where I just pay for the rehab and list it for her. This wouldnt be a seller financing deal would it? Instead, I would think to enter a partnership where I give her her price and I capture the difference, once sold. I was hoping I can ask the BP family on how I can take this deal on creatively, and since its such light work i really dont want to purchase the property from her just to sell it in 2 weeks. How would I take title, etc. Any feedback on the matter would be very helpful. Thank you in advance!
This doesn't answer your question- but how are you planning on getting a complete kitchen remodel done in 2 weeks? Are you doing it yourself, or do you have previous experience with a contractor that has done a quick turnaround for you or someone you trust in that amount of time?
More towards your question - it sounds like you want to do a partnership contract with her where you commit to paying her 335k in 6 months or when the property sells, whichever comes first. But that's asking for a lot of trust on her part, and also for you to be confident that you are going to be able to turn it around rapidly. If she is motivated, she may need the money yesterday.
Do you have access to hard or private money for this deal? There are just a lot of moving parts, and without knowing your current level of experience, it is hard to offer anything useful to you.
I did a similar deal last year and it was a little bit of a headache and depends on your state laws.
1. Draw up offer to purchase for $335k to be executed in xxx months.
2. File affidavit of interest on property.
3. Draw JV agreement with seller outlining who pays mortgage and fees, if the property will be vacated, etc.
4. List and sell.
Title company needs to understand what you are doing throughout the entire process or you will be toast. This is the type of deal that can get messy and go wrong if you and seller are not on the same terms. I suggest offering a lower initial amount and some sort of profit split as well to keep the seller involved and motivated/ on your team.
