[Nickolas Bubolz]

Nickolas Bubolz

Homeowner wants to sell and move back to home country. He is fine with any type of deal structure as long as he doesn’t have to worry about the property anymore and it is simple process for him.

3/2
2 car garage
1678 sq. ft.
septic and well, just outside city limits
11.5 years owned it
no repairs (have not seen it yet)
owes $176,500
fixed interest 2.58%
monthly payments will give me tomorrow when i visit him
Market comps are around $173,500
Market rent average: $1300 (will do a little more digging)

My offers:

1) seller financing subject to existing loan. Monthly payments are equal to mortgage, taxes, and insurance. I will purchase it for a rental unit but there is no room left is bank recalls loan to sell fast.

2) Lease option the property and re-lease it out to a tenant but he wants nothing to do with the property once he leaves the country.

3) HBS for seller financing. I would do a HBS for the highest down payment taking over the existing loan. So, the individuals would be paying market value for the property and any down payment would be above market value, which i would get all of it.

I would like to do offer 1 and if the bank recalls the loan, i will figure it out from there. The only worry i have is about the septic tank and drainage field. I not sure what condition it is in. I might pay for an inspector ($300) to look at the house before i purchase it on subject-to.

Any other suggests on creative deals for the property?

Thanks for the help.

[Jackie Lange]

Jackie Lange

do not buy it. it has negative equity which could get much worse

master lease with an option to buy — make it a rolling option that keeps getting moved out in to the future until there is actually some equity

Since the seller is moving away from the area, make sure you get ALL closing docs and warranty deed signed and in escrow before he/she leaves.

make sure that interest rate is FIXED. It may not be.

The rents seem really low compared to the price. check rentometer.com to see if the rent can be higher

S

[Nickolas Bubolz]

Nickolas Bubolz

The owner backed out of the deal and said he wanted to sell it outright now because he does not want anything in his name anymore. I told him alright but if you allow me to lease it out, you can move back to home country sooner. He still said no. I’m going to put him on my follow up to lease it with an option.

For a rolling option, you just make an option with the ability to extend. Correct? Or, does the option expire when the lease expires with the homeowner?

[DON WEDE]

DON WEDE

You would want the lease and the option both have the right to extend.
Don Wede