I'm looking to help a co worker minimize her losses.
She currently lives in the Springfield, MA are and is planning to move to SC in the next 6 months. She just told me that she is going to just leave her house!!! She said she owes about $60K and that it needs to much work and she is going to stop paying the mortgage soon. I told her that I was new to REI and to let me see if I can help.
So i started to look at the comps on the home and its not looking good. it was built in 1924 /4bed/ 1bath/ 1400sqft , its one of the only single fam houses on the street and she said nothing has been updated since she bought it in 1995 (roof,heating, knob&tube, etc). AND It shares a single lane driveway with the neighboring property, so weird!! There is not much appealing to me with this house, but now that Im trying to think like an investor I cant Imagine their isnt some meat on the bone for a home that someone is going to possibly just walk away from.
It seems like this would be a great first wholesale opportunity for me, especially because im close with the co-worker, but im skeptical that this house is going to be a head scratcher for other investors. im thinking to myself - even if this thing got 40K worth of updates, it still has the most congested plot of land Ive ever seen, who would really consider buying this thing????? Please share!
I think the key here is to find out what the place would be worth after it has been rehabbed (ARV). You can then work your way backwards using the "wholesaling calculator" from bigger pockets to see what that offer should be on the place. Since she owes 60K if the offer is less than that then she might just want to try and sell it (worth a shot if she wants to) if it is more than 60K I think it would be worth trying to wholesale it another investor. There are several threads on BP about getting started in wholesaling. This could be a great opportunity but the numbers are key and that calculator should give you a good idea if it is worth your time or not.
Do the math...figure out your numbers...get solid comps and a rehab estimate along with lots of pictures. Then put a package together and try to work with her lender on a short-sale.
Thanks for the response. I plan on doing the math and we will be going to run repair estimates. So Jim, your saying put a package together including what the bank would do as far as the short sale goes? Have you ever done a short sale? I would literally call the lender and say.....homeowners is looking to sell, we will buy for $XXX amount, what can you do?
I may be interested, depending on the numbers. Do your math and email me back with details to see if it makes sense for me.
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