Simple Strategies Housing Rescue Plan

[Bryan Silvestri]

Rich - I received a call recently from a company in Las Vegas that claims to purchase sub 2 with properties with NEGATIVE EQUITY. Here's the link:
http://sshrp.com/sell-your-property

So a buyer would purchase the house for not only the value of the liens which may be 3 times the value of the property, but also pay a premium of $5-$50K over that the seller would supposedly pocket.

When asked why on earth a buyer would be willing to pay 3 times the current value, I was told the premise is that there are buyers who cannot get financing anywhere and are willing to pay a huge above-market premium. That still doesn't make sense unless I'm missing something.

Look at the pitch on his website:

"I owed $500,000 dollars on my property but it was worth $200,000 dollars and I sold it for $550,000 dollars.
I avoided a foreclosure, and a short sale.
I didn't pay a real estate agent a commission out of pocket that could have cost me thousands.
I sold my property and put $50.000 in cash in my pocket.
I preserved my credit.
Need we say more?"

WTF?

When I again brought it up, still in disbelief, the rep told me "just worry about getting out of the property and let the buyer deal with buying it." This made me quite skeptical to say the least. There must be a catch, but what s it?

Perhaps they sell it to the buyer as a long-term lease option with a future price to justify the purchase? :roll:

Originally posted by Richard Warren:

The biggest issue with doing a subject-to deal in a city like Vegas is finding a property with equity. More than half of homeowners are upside down here (they owe more than the home is worth). For a subject-to deal to make sense you need to find a property with equity. They are out there but not easy to find. That being said, I do know of people doing it successfully.

Here is an article I wrote for the BiggerPockets Blog about someone who is doing subject-to deals in Vegas:

http://www.biggerpockets.com/renewsblog/2009/04/06/creating-equity/

:cool: