Found my first Lead

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  • I Found my first lead, This seller is motivated but not the property I wanted to start with.

    The seller is moving to another province

    A bi-level 2 bedroom upstairs and 1 bedroom in the basement

    Garage is double oversized.

    House was built 1981, bought in 2014 for $256k

    The house needs no repair as they were just done.

    payments are current

    monthly payment is $1400.

    I wanted to start with wholesaling but this was my was deal, I was think Maybe I should do Seller finance.

    Any Advice Please.


    Gbenro, you need to provide more information for anybody to guide you.

    What market are you in?
    Is it a depressed one with long days on he market, or has a lot of job growth with people moving into the city/state?
    What are the comps for the area?
    Days on the market?
    How many bathrooms?
    Square footage?
    School ratings?
    Crime rate?

    How did you find the deal?
    What was the asking price?
    How much of the ARV is YOUR negotiated price?
    Exiting mortgage?
    Seller’s motivation to sell besides the movecto another state?
    Any liens?
    Behind on property taxes, or payments?

    There are many factors that go into deciding what kind of a solution you may provide the Seller/Owner. What made you come to the Owner Finance conclusion?

    we need more info to help you determine if there is any opportunity here.

    Is the seller motivated to sell fast? why?

    Hello Ayesha and Jackie,

    I have gotten more information on the property.

    I am in the Winnipeg market, It is one of the best market in Canada, It is very Immigrant friendly compared to most places in Canada, so there is a lot of immigrants entering the city every year. At the last Investment club I went, I was told it is the best market for rentals and new home owners in Canada.

    The comps is about 270K( I think it might be up to 285k)
    It has not been listed with a realtor
    There are 3 bedrooms and 2 bathrooms
    Square Footage is 680.
    House was built in 1985
    Bought for $265000 in 2014 .
    The house is in excellent shape. No issues with the house
    The property is in a good neighborhood, good schools and low crime.
    PITI is $1450
    She said it is a 5 years fixed mortgage at 3.09 interest, so it will end 2019.
    She said they bought new appliances in 2015
    the mortgage balance is $242000
    Payments are current.
    She wants 265k for the property.
    wants to sell the house before July as she wants to buy another house in Ontario to move into in July
    I have not negotiated the price or anything with the sellers, These are just the information on the property

    I was thinking seller finance because the house is in excellent condition.
    Now I think this might not be a good property for me as there is not much equity and other factors like the 5 years mortgage.
    What do you guys think?

    Thanks guys for your time , I appreciate.

    I agree with you, no room for profit and the term is to short. I would just move on unless someone has a better idea. Do not see a deal here.

    Hey Don,
    That is what I thought,
    Another thing I was thinking was maybe I could lease option it for 2 years, then lease option to a buyer for a 1 year term.
    But the terms is really short. I might just tell her that I cant help her.


    What is the fair market rent for the home?

    Hi Don,
    I would say $1500, most houses I see for rent in that area with 3 bedrooms and 2 bath go for 1400-1500, but they all have one car garage.
    this property has a 2 car garage

    No deal here. You need to pass.

    Ideally, you find sellers who have a LOT more equity or at the very least more of a cash flow spread. This seller is not motivated to sell below market and there is no cash flow spread. If the seller were desperate to get rid of the house, the price might be cheaper but even then buying with seller financing for your first deal is not a good idea. It would be much safer if you just got an option then did a highest bidder sale. But a HBS will not work on this house – the numbers are too skinny.

    Always think how can I make money while still reducing risks. What’s the best way to structure the deal to accomplish both?

    You don’t want to get stuck making $1450 a month payments on a vacant house.

    And there is not enough equity to risk buying the house subject to the mortgage when there is a balloon.

    You’ll find another one that will be great! Just because a seller wants to sell their house, it does not make it a good opportunity. There needs to be some motivation to sell quickly for a discount or for really good terms.

    I have seen that there is nothing really in this lead and I have backed out.
    Thanks guys for your help.

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