Have a tough little deal and am unsure if this is worth pursing. In my mind, I'm giving myself reasons why this will work but the unknown is trying to outweigh my logic because of the "uniqueness" of the house as it's not typical and i'm not sure how much demand there is for this given my experience.
Property: 2B/1B Cottage (condo)- 422 Sqft
Purchase Date: 9/8/06 for $130,000.00
Amount Owed: Approximately $70,000.00
Reason for Sale: Divorce, cannot maintain and water pipe broke last month.
Comparable: .1 mile away, 720sqft condo for $184,000.00 so $255/sqft
Association Fee: $290/Year
When Rented: $1000/month
Expected Cashflow: 425+/month
Here, I figured my strategy to be to jump in and offer purchasing subject to the existing financing and taking over the $70,000.00 with a start date of a month or two from now to give myself time to find someone for a lease option agreement.
What is your play here? What more questions do you ask? What kind of rules do you follow with sub-2 deals.
Thanks everyone for the insight.
@Karen Rittenhouse your first deal you discuss on your podcast, I can't recall but was that taken subject to or did you outright purchase it? Also, is your general rule to get your subject to's .65/ on the dollar? Thanks : )
Yes, the first deal I did was a subject-to. No, we can actually pay more for a sub-2 because we don't have the cost of financing. However, I was new and scared and didn't want the seller to say "yes", so I only offered .65 on the dollar on a completely renovated like-brand-new townhome with all appliances including washer and dryer!!!
Moral of that story is "never think for the seller". So many investors "assume" the seller will never accept such a low offer. I have more opportunity to be amazed at the ones who say "yes" than at those who say "no"!
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