Hi! Question. I found a distressed property in a more upscale area that I drive by every day. Haven't met the owner yet but plan to. But I did some background homework on property. The ARV is ~400k. I know from the register of deed office that it got a mortgage loan adjustment in July of 2019 for 290k. The pre-foreclosure process started middle of 2020. The home is now abandoned. The owner actually lives in my apartment complex down the street from the home according to the tax assessor office. So the question I have is is if I get the home under contract for 295k let's say that's what left on the loan. And try to sell it for 310k. Are the numbers good for an investor to want to get interested in it or does it come down to the rehab costs which let's say at the very minimum would be 15k but could be a lot more. This would be my first wholesale deal. Honestly never thought about wholesaling always wanted to start out house hacking but I would hate to see this deal go to the bank. The person has "owned" it since dec 2007 if that gives an idea of the updates it might need. 4 bed 3 bath house. 4 car garage in kernersville Nc. If that helps as well. Thank you for you time and assistance
Suggestion. you really need to have someone (Contractor) give you an actual rehab cost. Believe that your buyer is going to do just that. Otherwise get your end buyer to submit their buying price upon inspection. This you can do during your due diligence walk through , unless you are virtually wholesaling it. still at the end of the day, your COMPS & REHAB have to be correct. I hope this makes sense.
@Jesse Juris A loan “adjustment” is a loan modification. The amount you see is typically not the whole balance, just the portion he is currently paying on. Typically the total balance is 30-40% more.
Look further back and see what his original mtg was. Talk to the owner, get a current total payoff from the lender.
Thank you @Eric Clinton and @Wayne Brooks .
@Wayne Brooks take a look at the picture. I don’t know much if anything but says the total on it but you may be right. It looks like a refinance at a lower rate. The rate in 2007 was ~6%. It also got bumped to 40yrs. I’m going to try and contact the owner today. I doubt the lender would take a short sale either especially with the new tax value assessed at 350k
@Jesse Juris Yes, the 40 years is also typical in a loan mod….this is not an ordinary refinance.
@Wayne Brooks excellent good to know. Thank you so much for your help. I just finished writing a letter that I’m about to drop off since there a notice on the door to do not disturb. Thank you again
max maxwell videos really helped me with comping properties.
@Drew Rose where do I find them? Are they on bigger pockets or YouTube
You tube...plus Jamil Damji and Ty Taylor also do comps on youtube. Jamil does his comps the way Appraisers do. Check them out when you getva chance.
Thank you so much 😊