Help, I Have A Great Deal Useing Quitclaim
Can someone help me by answering this question?
I have a homeowner who is old and sick and tired of taking care of two income apartment buildings. The two building has been appraised for $1.6 Million dollars 3 years ago. he wanted $975,000 but I talked him down to $905,000.
my question is as follows!
I talked him into giving me a quitclaim deed thinking that I can pull out equity within a few weeks the most! Is this possible that I can pull out equity quicker by useing a quitclaim? The two building will have $695,000 worth of equity in them together. Two very nice buildings in a very good location, its in Ohio. How can I work this faster to pull out some equity/
Thanks your reply is greatly needed
What made you think that a quitclaim was a superior title for this or any other reason? Go back, eat crow, admit you wanted a Waranty deed all along and didn't know it.
The easiest way to pull out the equity would be to flip the deal to somebody else.
First, I don't eat crow's, do you?
I was just asking for advice, not for you to try and make fun of my question. if you don't have a great answer for me, never mine posting! I don't agree to your answer, can someone else help me out here! I need to know the right way, to do this deal. If you don't know the answer please don't post thanks
I'm with the commercial-king - a quitclaim deed is not the way to get money in a few weeks.
This guy likes you so much he is going to "give" you over $200,000; right, I don;t think you are anna nicole.
To get the straight answer, you;ll have to talk to a commercial lender and ask them when they'll let you get your "equity'. My guess, I think you'd be very lucky to get any equity out within 1 year. And you better have a very good justification for the difference in the sale price and the appraisal when you do go to refi.
You need to re-work the deal and NOT plan on any equity for at least a year.
Not to be offensive, but it would probably be a good time to explain what a quit claim deed is, in case some readers are not aware.
A quit claim deed does not imply that the grantor holds title to the property, it merely surrenders any rights he may have in the property to you. It is the weakest form of property conveyance possible and is an absolute last resort to take title to any property. They are often used to clear title when questionable situations exist (getting ex off deed so house can be sold) but should not be used otherwise since the buyer assumes all the risks.
What does all this mean? For the bargain price of $905,000 I would be happy to quit claim the Brooklyn Bridge to you. Imagine the ROI if you added a toll booth
-Chris
[addsig]
You guys are very funny and helpful at the same time1
First of all, my husband and I are friend with the old man. He's a very smart business man, he have been in business for many, many years, maybe before some of you were born. He's very rich, and he wants to help us out! He just told us that he will do a straight purchase and sales agreement, with a promissory note to secure his asking price when I go and get a first mortgage on the properties. The properties are appraised at $1.6 Millions, he's selling it to us for $905,000. The Properties are in KY not ohio. I'm sorry about that, I'm working on and great deal in Ohio as well!
But to get back to you guys, I'm asking for help, and I get all these attack answer?
What's up with that!!!!
I'm a newbie, I can't help it if I'm getting great deals here friend's! If you know of a better way of doing this deal, then help me out will you? The gentleman is also a Doctor, he got plenty of money. I'm not rich i just need your help thats all. Are people supposed to be afraid to post for help here? Let me know I will stop right away!!
Where is John $Cash$? or somebody who can clearly help me without attacking me.
Thanks
The Doc owns these properties free and clear, there's know mortgage at all
Elisha,
You did not indicate how you are paying for the buildings. I assume that you are either paying cash or are taking out a loan. I am doing a similar transaction in that I am buying a property at a substantial discount and I am paying cash. I spoke with a loan broker who specializes in commercial loans about refinancing my cash back out plus some and he indicated that if my refi was not above the purchase price we could do it rather quickly, but if I was looking to get more out than I put in, it would probably take at least six months.
I hope that you don't interpret my response as an attack. I certainly don't intend it to be. I also don't believe that the other responses you received were intended to attack you or make you feel bad. The advice you received was very good and I believe was intended to keep you out of possible trouble. There is a great deal of very useful knowledge within this group and most are very willing to share their knowledge and experiences with you. I hope that you will recognize this and not be too harsh in your judgement of their intentions.
Regards and good luck with your transaction,
Ed
All joking aside, I would highly recommend that you get a good real estate lawyer to help you.
Don't take offense, but this 'doc' didn't get where he is by letting someone 'talk him into' signing anything. When it comes to money, I never believe anything I'm told and only half of what I see.
Personally, if a deal sounds too good to be true, I really want to know why. I understand that he may very well be wanting to liquidate, but why? Why does he want to help you? What does he get from it? What motivates him to sell to you?
These are questions that a good qualified professional will help you find the answers to. I know it sounds expensive, but the investment will pay a hundredfold. He will also be able to help you to structure any financing you need.
I agree with the others that even after all the t's are dotted and i's are crossed that it will probably be a year before you could get any major equity out.
You could probably add in a certain amount of money for repairs and maintenance for a period of time, but the finance people aren't dummies. They've seen about every trick you could throw at them.
I totally encourage you to persue your deal, but it is NOT going to happen quick. If you're worried about losing the deal, get a sales contract signed.
I thought I would throw one more helpful thought in just incase you didn't know.
Everything you try to sell has a range for it's value. Real Estate is no different. If you want to hold onto the property for a very long time you can probably get a higher price than if you are looking to sell it in two weeks.
Know that an apprasial is typically on the high side as a banker typically wants to know the highest a reasonable person would pay for a property.
Keep in mind that as an investor we need to be conservative. This is especially important in flipping properties as it is better to make $5k per house and do one per month than $15k per house and do 2-3 per year.
Even if you plan to keep the property as a rental you should be looking for the following things mainly:
1. It cashflows and you won't need to dip into your pocket each month to pay the mortgage.
2. The property is in a good location and the property is likely to stay a good location.
3. You don't overpay for the property because should you decide to sell it, you might run into troubles.
A rule of thumb on commercial properties--if you can purchase at or below assessed value you have a good deal. Know that assessed values can be off but it is a good off the cuff guide to your initial thoughts.
GOOD LUCK
Hi and thank you all so very much. This is what I wanted to hear. You guys are great.
I have done the title search and its clear. Like I said, the Doc is a friend, he has seen us go thru so much and we still keep fighting back! I'm trying to learn the business of real estate and I again thank you very much for everyone help. I'm sorry if I came off seeming hard, I'm a very lovely person.
I just need good advice. I'm trying to go around attorney's, you can't really trust them either!
I may just flip the properties, this is just talk, not trying to sell to you guys! NO SELLING HERE! But I would except all private email for great advice on helping me move forward. Should I put the properties up for sale? I wanted to keep them as rentals. They are in the greatest condition total rehabbed located in a very good location. The Doc has over 1,000 properties. He may let me buy all of them. I was going to get a new loan to pay off the Doc. I was also thinking about making a deal with him to take half of his asking price and giving him a second using owner financing to pay off the other half. what do you think about that guys?
If you were in my shoes, how would you do a deal like this? Let me know thanks all again bye