I smell a deal, but... (probate question)

3 Replies

ARV = $110,000 * 70% = $77,000

- Repair Est: $30,000 = $47,000

- Wholesale Fee: $12,000 = $35,000 

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Mortgage: $21,000

+ Back taxes: $7,500 = $28,500

+ Cash to seller: $4,000 = $32,500

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Problem: the house hasn't been probated yet. Seller refuses to come out of pocket a single dime.  The probate will cost ~ $2,000 brings my buy price to $34,500. 

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I'm willing to front the $2k if I can make it back plus another $10,000.  But I'd need to write in some protection.  I realize that once I pay the legal fees, I'm effectively ouut that money.  

*There are 2 other heirs that supposedly will sign off on anything needed to shed this house.  It's in bad shape.  

What if I write him a check to cover legal fees, call it EMD, get a copy of check to title company, and file an affidavit of equitable interest and require the EMD back if he fails to go through with the sale after probate? I would never normally give an EMD to a seller, but in this case in trying to make something happen.

I realize some of you will say walk from the deal but I'm just getting started with 2 deals currently in escrow, need all I can get.

Hot market and I'm very confident I could move the property to a buyer for $47,000 and can come down if needed.

Advice appreciated.

Mike 

Do you have an attorney? One that knows probate? What about inheritance tax? other liens? If it looks like a clean deal, I wouldn't do anything until you get that deed signed by all the parties and held in escrow until closing when it can be recorded. Have your own attorney or title company on your side for this one. Not worth free wheeling when it gets dicey.

I agree with @Michael Knaus ... don't rush into a mess. $7500 in back taxes could be just the beginning of the problems.

Signing a contract with someone who doesn't own the property doesn't give you an equitable interest. Giving an EMD to a non-owner is asking for it to disappear.

An estate needs to be opened regardless. And that can be started without an attorney. If they really want to sell the property make them do something about it.

@Mike Jones

Ok, you have your numbers but the property has to be probated. How did you come up with the $2000.00 probate fee?

Estate Representative/Attorney Fee's are set by the FL probate code.

Still the buyer your dealing with has no legal authority to sell the property. Maybe one of the heirs may consider starting the probate process.

Or you can possibly buy out all 3 interests and start the probate process and pay the required court fee's yourself...

Mark Pedroza, Real Estate Agent in CA (#01858403)
1-415-786-6700

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