First Probate Wholesale Appointment?

Question

So after months of mailing i finally got  a motivated seller to show me their property next weekend. I just had a question. If property was appraised at 125k.. and 47k is owed on the mortgage. Since the home is the only asset of the descendant, would the sell of the house have to be the liquidation to pay off ALL or SOME of the creditors, expenses, attorney, fees  etc.. as well?

Would i not be able to make an offer just to pay off what is owed on the home?

My understanding is "IF" i did make the offer to only pay off the mortgage, that means the executor would be liable to pay off the rest correct?

but of course the over all goal is to help out, so i would assume i would have to make an offer to pay off the mortgage + creditors, debt, fees and etc?

or could i make an offer to Pay off mortgage + a portion of debt and the rest can be paid by executor or heirs? (Of course with agreement)

I just want to make sure that I am going to make the right offer. that provides a WIN WIN situation. I appreciate anyones help thanks guys!

Wayne Brooks · Answer

If you inherited a house worth $125k, and the mortgage was $45k, would you be so willing to accept only what is owed, and give up $75k?  Any reason to think this seller would?

Christian Smith · Answer

No worries! You will need to find out if there are any liens against the property during your due diligence period. If so, what kind of liens & the total cost. The liens are against the property, not the owner. You cannot purchase the property without paying those off unless you went with a creative financing route. Be very cautious with what kind of liens they are because if a bail bondsman has a lien against the property they will more than likely foreclose on it. From my experience, If you want it to be a WIN WIN...IF they accept your offer at the 47k which is owed on the mortgage, make sure you pay all closing costs, attorney fees, etc...you don't want the seller to be in the negative. That will be a deal killer all day long.

Rick H. · Answer

Wow, this is a confusing pile o' stuff.  It doesn't gave to be.

What are you trying to accomplish? Buy the equity for a discount?

If you're just trying to buy the equity, buy the asset subject-to the old mortgage. When I do this, I use seller financing (carry back purchase money mortgage).

I may want the old loan to remain.

Of course, if this is an estate sale requiring court confirmation, you've got a different kettle of fish to deal with. Attorney will probably be your first hurdle, then the probate attorney who works for the courthouse and then the judge or commissioner.

But first, you need to get clear about how you intend to make a profit, how to structure and then how to sell the proposal to all parties.

Suggest you get someone to help you with experience to communicate the offer once you understand your own objectives.

Derek W. · Answer

If you are trying to buy the asset, you are going to make your offer for the highest amount you can pay and still make the necessary desired profit. If the seller accepts your offer, you open escrow. The escrow and title companies will figure out what needs to be paid from the proceeds. It's not your problem. If you are trying to buy the equity, I would suggest you do a lot more home work before trying that route.

Guy Olds · Answer

Account Closed

Since you called this a wholesale deal you need to look out for your cash buyer. You will need to know the ARV, the repair costs, and the profit for your cash buyer wants unless it will be a rental.

To figure what to offer you need to know your Maximum Allowable Offer (MAO) so that would be the ARV times 70% or 75% minus repair costs. To find out how low a selling price the PR will accept you'll have ask what he wants to sell the property for or how much cash he wants or expects to go to the estate at closing.

Once you have the information then do your best to make all the numbers work for everyone.

Account Closed · Answer

THIS! answered my question thoroughly. It is now understood. so in a sense u if admin has been appointed and sells the home far below market value etc. it would be the wrong choice because if there is large debt. then seller can come after me and end buyer.. GOT IT.. this is the only answer i needed lol thanks everyone

Account Closed · Answer

Overall Goal is to whole sale this deal. So i wanted to make sure since they have full authority and have already been appointed by the court. that they are able to sell the real estate separate from the other debts left over.

Account Closed · Answer

Hey guys appreciate the assistance. The reason why the seller would let it go is because she is currently in probate and has to sell to pay off descendants any remaining debts. I am very aware of the .70 from ARV . I just wanted to make sure if it would be ok to make an offer to pay off any liens and the mortgage on the property? Separate from the creditors.. Attorney fees and etc from my understanding during probates all assets are sold to pay off any remaining debts and whatever is left over IF ANY would disbursed to beneficiaries.

Account Closed · Answer

Liens, creditors, attorney fees, etc.. sorry if it was a confusing question.

First Probate Wholesale Appointment?

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