Can I do this deal with a seller

Question

I have a motivated seller, who is free and clear of a mortgage of $16,000 and is firm on selling for at least  $10,000. The house is actually in descent shape with the only problem being an unfinished backroom and the a/c window units could stand to be replaced. House comped well tax assessor did give fair market for 16K. I did look at some website pricings which was considerably higher, but was only used for reference.

The problem I have run into is that she is motivated to sell and tired of living in the area, but is on disability and can not afford a lot with the amount given ($800).

She probably would have signed an agreement after our meeting, but I did not feel comfortable signing the agreement not knowing if this seller would have somewhere to live after and it sounding like I took advantage . She asked about section 8 voucher housing program, which is a subject I am not completely familiar with, but I said I would find some answers about the subject and get back to her.

Is there a better way to make this deal happen or am I delving into dangerous territory?

Kyle J. · Answer

One thing to consider is that the Section 8 wait list can take years, depending on the area.

Tj Hines · Answer

I'm not understanding...... she is receiving 10k at closing that can most definitely help with moving costs. Right now she doesn't have any cash in her pocket. All she has is the $800.00 every month to live off of. At least this way she will have some cash in her pocket when she moves with $800 coming in.

Good Luck!

Ricky Lopez · Answer

Hi Michael,

Thanks for the post, while speaking with the seller, she did bring up  living alone, while having a disability, as being another factor, but I do agree, that it could be any number of reasons. I spoke to the seller today over the phone and it seems like this may head to nowhere, didn't seem as enthusiastic or wanting to much information about the voucher program.

Michael D. · Answer

Ricky Lopez, you say that she's motivated. By what? Why is she considering selling without a plan for where she'll be living afterward? Being "tired of the area" isn't enough of a reason to leap without looking. Maybe there's something she's not telling you yet.

Michael

Ricky Lopez · Answer

While looking over the section 8 website, I am know wondering if this seller would even be a candidate for the voucher program. She wants to move from the area, but since she owns a house, I would think the persons name would stay on the bottom of any waiting list.

Mary B. · Answer

@Dawn A.

Right now she has no mortgage payment likely only insurance that may be just fire or something that's bare minimal because she needs to have some sort of insurance but can't afford anything too costly.

Remember the super fixed income so even with a $10K down payment depending on the market it still may not be enough for her to start over.  Taking into account additional expenses that she has and ones that can possibly occur. One huge medical bill and that can be it! Why get in a situation where she's under foreclosure within a year?

Kudos,
Mary

Dawn Anastasi · Answer

If she is selling for $10,000 and she owns the house free and clear, then wouldn't that money be for helping her move?

Ricky Lopez · Answer

I kind of got that feeling, of would this person, be better off just staying. I want to make money but not put someone in a bad situation.  I will definitely do the follow up

Thanks

Mary B. · Answer

Wow you definitely don't want the seller worse off at the closing. This business is about win win situations so if everyone involved doesn't come out a winner its not a good deal.

I'd find out how long the seller needed to find other housing and if that was even possible being on a super fixed income. If you can assist them with those arrangements that would be great but you don't want to put them out of their home I understand your point.  Do a follow-up with the seller and if it comes down to them not being able to afford another place(such as assisted living etc) because section 8 housing can take a while and it might not be cost effective for you to get in too deep. You have to know when to walk away which varies per deal. Much success to you.

Kudos,
Mary

Ricky Lopez · Answer

Hi Wayne,

Thank you for responding, yes I did mean paid off. Ill check the HUD website and see if I can find anything.

RIcky