Creative Solution for this tie deal?

[THU NGUYEN]

Dear BP community,

I need help to see if there is any way I can turn this into a deal?

I came across this deal. owner owes $130K on mortgage. ARV $180k. The house needs $15K external update (replace sidings, patio covers etc) and $20K inside update. HOA sends letter to request for external repair but he has no money to fix it up.

Livable now condition. Owner wants to lease it back at $1500/month. No inside update needed while renting to him.

The GC that I talk to is this seller next door neighbor. He wants $5K assignment fee.

I would not buy this house at $`137 (130 current mortgage balance +5 assignment fee +2 closing cost) but I am thinking about Subject to...what if I put $15K down to fix the outside, I will pay the mortgage for him (1300 per the GC -escrow included) and collect the $200 difference in rent. Owner will rent it at $1500.

Another way would be trying to buy the house short sale? It's FHA loan...I need to find a realtor that knows how to work FHA loan?

The house is worth $180K - $185K once updated and need $35K work, mortage is $130K now.

Is there any way to make this a deal?

Thank you for your input.

Thu

[Chris Bounds]

I'd pass on that one. Little equity and cash flow. Plus leaving owner in the house adds extra risk (in my opinion).