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Following the valuable information and advice in the “5 Best Ways to Make Money with Real Estate in 2015”, I’m wanting to ‘sell it for a little profit’ so I can get rid of debt as fast as possible.. As far as someone ‘offering me an option’ on the property, through my initial discussions with them, I simply asked them if they would give me an option to buy the property, and they indicated that they would. So, what I’m wanting to do is tie the property up with the option. With that in mind, once I get the option, what would you suggest as far as the best way to make a little profit and get out of the deal?
Still need payment info please. Is it a 30 year fixed rat mortgage with no balloon?
Knowing your exit strategy, I’m leaning towards selling it with seller financing that wraps the underlying loan. Using a Highest Bidder Sale would net you the maximum cash.
But I need more info about the payments, mortgage, and condition before I can advise.
Jackie, it is a 30-year fixed rate mortgage with no balloon. It’s in very good condition. Payments are $627, which includes PITI. Approximately 28 years left on the mortgage. I like the idea of selling it with seller financing that wraps the underlying loan, using a highest bidder sale. And I take it the highest bidder sale would be for the down payment, right?
Yes, the highest bidder sale would be for the downpayment.
You could advertise the sales price at $87,900
startiing bid $1000You will have potential bidders come out of the woodwork
You should be able to get $7,000 down approximately. I usually get 10-20% down when I do a highest bidder sale for the down payment.
You could also get $100 a month cash flow too. What’s the current interest rate?
When I do a highest bidder sale for the down payments, I usually have an interest rate structure like
< $3000 down ____%
$3,000 to $5000 down ____%
$5,000 to $7000 down ____%
$7,000 to $9000 down ____ %Reward people for putting down a larger down payment!
A highest bidder sale for the down payment would be the best way to solve the sellers problem and for you to make money fast.
Don, I don’t have an option at this time. If I got an option, it would most likely be for the principal balance. I would then try to secure seller financing that would wrap the owner’s note/mortgage, and then sell it with seller financing and HBS for the down payment. Hope that answers your question.
When you sell with seller financing, you can charge a bit more than market prices… if there are any other comps in the neighborhood to support the higher price. If $80,000 is the absolutely top of the market and there are not any other houses sold to support a higher price, then you would need to go with a master lease with an option. you could sell with a lease option. You can still sell for a bit more than market.
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