We are excited to say we received news of a deal today! We used the BP calculator to review the numbers. However, we would love some expert advice.
This is a buy and hold deal in a good part of town. The seller is motivated to get rid of the property and move on with their lives.
Townhome/rowhouse built in 1875
2 BR 1.5 bathrooms
Current owners owe $155,000 with a 2% interest rate
Current mortgage: $825 (not including taxes and insurance)
Resent sales in the area are $200K-$240K
Average rent in the area is $1,811
Management company fee: 9%
Property taxes (estimated): $4,000/year
Insurance (estimated): $100/month
House size: 764 square feet (average for homes in the area)
We are estimating 6% of the selling price in closing costs including the inspection, title etc
The seller wants to keep their current mortgage on the property and is asking for $20,000 down which includes the wholesaler cost and realtor cost.
The seller does not want to tell the bank about the deal. The seller wants the buyer to take over payments and will sign over the deed.
I have read articles about mortgage companies due on sale clause. I am not a fan of the method the seller wants to proceed with. My hope is to negotiate a sale price that is beneficial for all parties and get the mortgage under our LLC.
Thoughts, ideas, opinions, suggestions are all welcomed. Thanks in advance.
Does the property need any rehab done to it?
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