Mikes Journal

So I called the owner(s) of the sad little house, and it's a mess. In more ways than one.
It's held by a group of siblings in separate trusts. It's going to take some legal work to get it out. And there's no single person to present an offer to.
It's vacant, and over the winter, they suspect a water leak because of a high water bill.
The sister who died was a "saver".
Nobody has been in the house in months because everyone is far away, and they don't have a key.
Oh yes, they want to sell, but they realize they have a mess to clean out first.

I sense trouble too, but is this situation recoverable? Or is it radioactive?

Congrats on taking ACTION! Feels great, doesnt it? Taking those first steps changes everything! As far as your sad house - hopefully Rina will jump in here. I think the house she assigned to me in Wisconsin went through this very same process, and it took a long time too. But guess what - the owners insurance company ended up paying for the total rehab due to burst pipes - so I'm ending up with a 'new' house for the initial contract price. Sweet! Read through Rinas journal and I think you'll find the story in there. But if the house is in a good location it could be worth the effort. There has to be a trustee of the estate - that is the person you would deal with. See if you can find that out and start from there, or if you can, prepare a prosposal letter and send to all siblings at once maybe. Good luck and I look forward to seeing you post as you go along!
Laura

I should know this, I went through this with my own parents. Great idea Laura, thanks!

I just noticed I havent put anything in my journal in a while. It's like theres a few little things, but nothing noteworthy. Meeting people at REI clubs, etc. My potential sellers of the sad little house are ignoring me, and I sort of understand, as they deal with the passing of their sister.
Need something to shake things up.

I got a phone call from the owners of the sad little house. He said they had it cleaned out and he was ready to show it to me.
PANIC! Quick refresh my comps, quick review the forms (still don't understand, that will be my undoing...) and off I go.
It's a mess. Fortunately only a 2/1, but it pretty much needs to be taken down to the studs. A perfect assignment candidate, if I can get it cheap enough.
It's a nice neighborhood and ARV comps went for 155K there recently, so,
155K less 10% to sell it quick = 139.5K
139.5K less 30% for someone elses profit = 97.5K
30K repairs x 1.33 for safety = 40K, so we are down to 57.5K.
And 5K for me, leaves 52.5K.

My stomach is in a knot. So I offered 30K.
We eventually agreed on 50K, and he pays sellers closing costs. Great!

I have to say at this point I am stuck. I read Deans forms, and I am unsure of their legality in my state, so, since Dean's (or Matt's) advice was to have an attorney get you thru your first assignment, I called an attorney.
He's going to help me with the forms on Monday, I guess, but his hip-shot response was, "the sellers attorney is not going to like you having no earnest money in the deal for 30 days".
So that's where we sit, and verbal offer on the table, no money out the door yet, but disaster looming when the purchase offer hits the sellers fax machine.
Has any one else had this issue and solved it?

Can you front a $500 earnest money deposit or even $1000 for EMD until you find your buyer? Or can you finance the deal yourself like Laura did? To rehab it and turn around sell it by owner or with the assistance of REA. Those are my suggestions to questions you have to ask of yourself.

Looks like you have a great deal and go for it !! Good luck with the attorney on Monday and let us know.

Warm regards,

Paul T. La Moy

Good ideas, Yes I suppose I could front the EMD, And I might do that if I was really really sure I could assign the contract. But as a newbie, my buyer's list (yes, I have one) is very short. So, to reduce my risk I'm going to try this with no Earnest Money.
Something that this new REI adventure has taught me is that sometimes I am surprised by what I can make happen.

Does the property fit your buyer's criteria? Are they Cash buyers? If they are, shop it to them!

With the help of my atty, I submitted the offer to the sellers on Tuesday. Just like we verbally agreed, but now we had paper to back it up. Thursday the seller calls me and leaves a voice mail, "We have received your offer, and it is not accepted. We are going to list the property with a Realtor for $109K."
How they will get that price on that wreck of a house as absentee owners, I do not know. I wish them well.
What have I got? A little more experience, I pushed the boundaries a bit, and I know how the deal goes at least part of the way.
And I have an attorney. And a bill from him, I'm sure. I also have the initial forms he drafted which I can use again on the next assignment deal.
I'll consider this "tuition" and move on.

Enjoyed reading this - and I love your attitude about learning your lessons and moving on. Trust me - in this real estate business there are many, many lessons to learn on the way to every deal! But thats how we reach our goals. I always remind myself there are no failures - just lessons! And hey - you never know - that house might sit forever and you end up with it in the future. Keep your eye on it. Good luck and keep on keepin on!
Laura