Lien Reduction Negotiation boosted Profit

3 Replies

Investment Info:

Single-family residence fix & flip investment in West Palm Beach.

Purchase price: $79,000
Cash invested: $42,000
Sale price: $209,900

SFH with a lien that was 3x the sale price of the property. After fixing code violation I negotiated lien reduction with the city to just 2% of the lien fine. This boosted my profit automatically.

What made you interested in investing in this type of deal?

The potential profit with a lien reduction

How did you find this deal and how did you negotiate it?

Wholeseller, negotiated a few bucks down

How did you finance this deal?

Cash

How did you add value to the deal?

Fixed the property, added color, improved landscaping, new roof.

Lessons learned? Challenges?

Taking action and calculated risks is the key to success

Thanks @Robert Darling ! while I wasn’t 100% sure, I knew there was a very high probability of reducing it to at least 5-10%. Worst case scenario, I would had hold for sure. Having prepared a speech with statistics and speaking honestly went a long way with the special magistrate in this case. I believe city officials appreciate when investors don’t try to bs them. 

@Roberto Aguilar-Cancino

Congrats on the flip. When did you submit the application for the lien reduction and when were you scheduled for it? After the purchase was made or after all the rehab was completed?

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you