$25,000.00 on a “Subject To” Deal in 30 Days
I bought William Tingles book on Sub To’s some time ago and am very glad I did. I bought a house sub to for $200k. After putting it under contract and getting the deed like the course recommended I was immediately able to obtain and control the house to hold, sell, or whatever I wish. That is the beauty of subject to investing. I believe in spending the money to purchase the right courses to educate myself as an investor, glad I did. Plus I used an earnest money of $10! “Ms. Seller it doesn't matter as you are getting all your money in a few days anyway” is the rationale I always use. The seller had a first mortgage for 170k and a second home equity line for 28k. But here was this seller giving me a lovely home with a pool about 1200 sq ft. two car garage in immaculate condition, I mean wonderful drapes, tile floors, marble counter tops, black sharp appliances, mint condition for nothing. I was like “score!”
I wanted to give her something for her cooperation… just not out of my pocket! So the second was a home equity loan with a remaining balance to draw on of 2k. I told her to take the 2k left on the equity line for moving expenses. She did, she felt good and I felt good. Win Win! The seller had expected no money initially so this was real treat for her. Plus I was always taught to give them some cash if at all possible.
Her motivation was simple, to move down south to be with her sister, but after she secured a second note the equity in the house was used up thus she could not afford a realtor, closing, and holding costs.
Originally, I was going to rent the house. The problem is that in Vegas you got to get them real cheap to have cash flow because several investors have bought and held properties here. Then I was going to advertise it as a lease option. I finally decided to sell it and took Williams’s suggestion in his Extreme Marketing book to get a metal, large, realtor style sign; I did, and put it out front just in case a good buyer drove by.
Sure enough, shortly thereafter buyer called and said they wanted to buy and could close after a week. His father was taking out a home equity loan on his residence in California. After two weeks it was a gross profit was about 25k in one month. Not too bad for this new investor.
This is how the numbers worked out:
$200k My purchase price (first loan and home equity loan)
$2k Holding and repairs
$227k Selling price
Thanks William Tingle.
Bill Guerra (Bill in Vegas)
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