OfflineI looked at a house over the weekend. Guy I called from a FSBO sign and I think I found a potential private lender. His parents moved in his house because they are to old to be on their own. His sisters and brothers have an interest in the house and they want it sold. He does buy property but doesnt want anything to do with this property. He says the home is paid for in full. Doesnt want to get invloved with family stuff.
ARV is $210k
willing to sell for $170k
Repair cost about $15k
House needs a lot of updates, new kithcen, new bathrooms, new carpet, new doors, wall paper removed and paint etc.
Based on the convo we had I believe I can get him lower on the price!! He says he wants to get the "damn" house sold. What type of offer would you guys present him. I have a few options in mind. But I would like a few diff point of views. Thanks in advance guys and ladies. He told me all the props he bought. He sayas he has money, so I asked him he would consider lending. I pitched to him about being my private lender. He said I don't know. I told him I would run the deals I come across by him and numbers and he said maybe if its a good deal, he would consider lending!! I got his address and mailed him my private lending letter, explaining how it all works and how he makes money. I presents examples of how he makes money at 10% interest. So he knows I am serious.
I got my mind made up.....
www.Kingjussinvestors.com
www.jussinvestors.com (buyers site)
If the property actually sells for $210,000 and your rehab/remodel costs are $15,000 here are some generic numbers based on a 90 day hold not including money costs
Commissions, taxes, utilities, insurance, closing costs 10%
$21,000
So your offer with no profit is $174,000.
I don't know your strategy on this one but if you are wholesaling your buyer will need at least a 10% ROI then you must subtract your fee.
So 10% ROI and a $10,000 fee means a $150,000 max offer.
Hope that helps,
Michael Mangham
MD Home Acquisitions
Knowledge is power, but execution trumps knowledge. Tony Robbins
http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdhomeacquisitionshousehunter.com Bird Dog Site
http://www.mdlodeals.com Tenant/Buyer site
Michael appreciate the response. I am planning to wholesale first. My offer would be $130k and see what he says and see how high goes, before I can cut.
I was also thinking about optioning it for $155k depending on if her turns my cash offers down. Then see if I can find a qualified buyer that is willing to do a work for equity program.
Or lease option it to a rehabber or homebuyer let them do the work, and sell it or cashg me out!!
I actually just got an email from a guy about this house on Craigslist. I posted the ad earlier this afternoon. And he repsonded to another ad I had up about another house. I will call him tomorrow!!
Your numbers are dead on though!! Thanks for your feed back.
I got my mind made up.....
www.Kingjussinvestors.com
www.jussinvestors.com (buyers site)
since the home is free and clear, have you asked about owner financing or L/O - show them how they could make MORE by owner financing
I agree with Michael above no more than $150k
Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools
But guys. I am speaking of another property here!! A lady just agreed to let me option here house.She told me to draw up an agreement stating what we talked about. I believe I use the lease/option agreement. But guide me on this which doc do I use?
I got my mind made up.....
www.Kingjussinvestors.com
www.jussinvestors.com (buyers site)