[William Salas]

William Salas

Hi! I have a deal on the table where I am approaching the seller with terms for seller financing. She is potentially into it; she just needs me to start the conversation.

Any input from others would be appreciated. Let me know what you think, thanks!

DETAILS:
She wants $315k for the house. It’s a 3/2 single family that is currently rented for $1,550 a month.

The house needs work, it’s livable but hasn’t been updated in awhile.

Fixed up, the house could rent for $2,500 to 3,000k a month.

I’m thinking of offering her $315K over 30 years at 4.25% which would equal what she is currently receiving per month.

She is 76, so maybe giving her some type of Call in 10 years where she has the option (or not) of calling the note due (this is more for her peace of mind than anything since she’s older).

Ideally I do this do with little to no money down.

How would you structure this?

[jimi hendricks]

jimi hendricks

Hi William –

“She is potentially into it; she just needs me to start the conversation.”

This is the key. You don’t want to go in with a firm deal structure in mind until you’ve LISTENED to her.

I like that you’ve found a property that has $1,000 + upside per month after a little elbow grease.
Perhaps she is interested in receiving the same monthly income (approx. $1550) without all the burdens of ownership and tenants?
Perhaps you can make her aware of the benefits of an installment sale tax treatment ? (She can talk to her accountant about IRS Pub 537)
I wouldn’t assume a 10-yr call since she is 76 … I’m still paying on a note to a 92 yr old lady (she’s sharp as a tack).
Does she have children and an estate plan ?
Why does she want out of this house ?
Ask questions … and then brainstorm multiple structures that seem consistent with her goals.
Most importantly … Then Make A Written Offer, and present it to her.
Listen to her feedback, and adjust the offer accordingly.

[Bill Cook]

Bill Cook

William,

Before trying to make your offer, first, FULLY UNDERSTAND HER REAL ESTATE PROBLEM. I don’t think you are there yet.

Have you met face to face with this seller? Have you done a T-bar. If so, please share the T-bar.

Bill Cook
770-815-8727

[William Salas]

William Salas

Thanks! You know, i’ve offered to meet in person, she she hasn’t wanted to yet.

Her partner died and he used to mostly manage the properties and I think she wants to simplify her life, at least that what she told me.

The rapport has been good but there is something I’m missing, when I called to follow up on my offer she said she was still thinking about it but had no questions or counter offer (which I dont like).

Usually serious sellers considering your offer have more questions or negotiate on terms.

I’ll keep everyone updated!

[Bill Cook]

Bill Cook

William, you hit the nail on the head: Usually serious sellers considering your offer have more questions or negotiate on terms.

Bill Cook