OfflineI came across a FSBO in a low income neighborhood which is also a neighborhood next to one I grew up in. The property is going at 25K they owner estimates that it would need 17K worth of rehab and then the after rehab value would be 60K. I called the owner up on the deal and met with what I think is her agent. He tells me that she is 5K behind on her taxes and she wants some one to catch her up on them plus give her 2K up front. Do you guys think this is a good deal?
I have to figure out where to get the 2K from. I can work out a deal with the county tax collector to pay the back taxes. I have a friend that works for Lowes that could get us discounts on materials and me and my husband plan on rehabing the house ourselves to minimize costs in repairs. I plan to either live in this house, give it to my grandmother (she's currently living in an apartment as a direct result of Ike), or rent it out and take section 8.
What do you guys think? Or do you think there's a better way to get this property without paying the 2K up front?
Will the owner take 5K less for you paying her taxes? If you are going to have your grandmother live in it, can it be listed with HUD and get her onto HUD possibly? That would get her a nice place to live plus you would have guaranteed rental income.
I didn't think of that, asking for 5K less. I was thinking more along the lines of not paying the 2K up front or not paying her anything while I'm trying to catch up the taxes. If my grandmother stayed there I wouldn't charge her anything to stay there. I don't want her paying anything for the house. She will be turning 70 in February and that would be my birthday present to her. If she chooses not to take it that is when I would accept Section 8 for renting the propery particulary since its in a low income neighborhood. I have gone through and looked at all the lease houses and they're charging $900 to $1000 a month and guess what? They are still vacant. I plan on leasing this for about $600 maybe $700 since the taxes there are relatively low in this area. I think they range from $1200 to $1500 a year. I bet this house was willed to this woman and she has no interest in it. Its probably been on the market since forever and a big plus is, my grandmother raised her kids on this street and my uncle, her brother, lives on this street so she'll be close to family.
Iwould check with public record,if she is behind on her taxes,she may be behind on other things like homeowners Ins.You may want to run a title seach to make sure she doesn't have any other liens on the property.Does she have any equity in the property,possibly do a split equity deal.
whurndon
H&H PROPERTY SOLUTIONS LLC
Im sure you wouldn't charge grandmother any rent, but what I meant was if she was eligible to receive HUD housing then you could get your money from HUD and grandmother would have a place to live for free.
Brian
Ahh ok. Hmm Whurndon how would I get a title search done?
You might want to go to Recorder of Deeds Office. Just ask that you want to do a title search. In my state they'll let you use their public computer and it should also be the same there in your state. I think they will also let you go to the protonotary office. I hope this will be helpful. I'm also trying to get my first deal.
Thanks, I will do this during the week. I'll just have to take off early from work to get there.
So if I decide to sell this place I stand to make 14K in profit. I don't think it will sell too quickly which is why I am going to rent it out (and list it as well).
I think I'm getting a deal because the house actually appraised at 39K according to the tax accesor's website. There were also some discrepancies. The add reads 3/1 but the tax accesor's website says its a 2/1. I will have to physically go and look at the house. I have already contacted an inspector that would charge $350. He's also a licensed termite inspector which is included in the price. So I get a twofer.
I saw a few ads where there were some people desperate to sell their homes. One guy lost his job and bought the property as an investment and could no longer keep it. He's made some upgrades but isn't done. I'm going to see if I can find an investor that's willing to buy it and charge them a finder's fee. What is good way to determine the amount to charge for finding property?