Hey guys so I'm trying to work on my first deal. I don't have much money so I'm trying to get as creative as possible. I have an off market property in Las Vegas that is being sold for 155k. I may be able to lower to 150k but as of right now it's 155k. The rehab is going to be 30k and the ARV is 210k. The seller is an investor who took on too many projects and needs to get rid of this one because his contractors are too busy. I offered a sellers financing and he said he would do that for 15% down, up to 6 months, and then 1% each month which is 1,500.
The issue I'm running into know is that I was planning on using a HML fund it but I don't have to now. The issue is that I don't have the money for the 30k rehab.
I tried asking HML but they need to be in first position lien and can't if it's a seller financing and I tried construction loans but I don't have a business and my income is low so I won't qualify? Any recommendations/tips/advise you guys give me would greatly appreciate that
Factor in your closing costs and holding costs.
There is no profit in this deal for you.
The seller may be willing to finance it because he can't sell it for the price he wants.
If I have too many projects going, I'm only selling one for cash and I wouldn't be financing it.
Thx Ryan for the input. I am definitely being generous on the numbers but it does make sense. We are also not using agents for our close the first closing costs won't be as high. I didn't think about that as far as if you sell one, you're selling it for cash so thx for that. But at the same time, he has a HML on the property so it's not crazy to think he will do anything to cover his monthly payments as well as make a small profit.
This is not going to be a flip right? You can’t pay $155k plus $30k in repairs ($185k in to it with ZERO INTEREST/HOLDING COSTS) and then sell for $210k and give that pair of realtors $12k (Netting $198k)and pay closing costs again (las Vegas taxes each title transfer)
So you can’t make $10k if it’s a zero percent loan with no insurance or property tax, title insurance, or utilities after paying paying the transfer taxes.)
If it’s a buy and hold you might be saving $20k if it’s a zero interest loan over buying it already done.
I am not a flipping expert but I don’t see any profit in this deal. Want to wholesale it to me? I might want it for a rental.
You already have a buyer. Take the easy win.