A Lady That My Other Half Works With Told Us That She Does This...(m)
She purchases property through city auctions, ex: if her bid of 20k is accepted on a property, the city does a land contract with her where she has to re-fi in 30days or 6mo, I forget which one. Well, she fixes it up and gets and appraisal and takes out a loan for the appraised amount. She then pays off the city, and pockets the rest. Is this legal? Is it illegal? I know I'm trying alot to get a deal but I don't want to get into any trouble. I'm trying to figure where what she does is wrong. She also then section 8's the property out.
Help me on this one you guys.
quinn
I think this is very legal. I'm not sure why this person has such an "in" with the city but I have heard of other people who do this exact thing. A distant relative of my realtor does this same thing and I'm trying to get my realtor to set up a time where I can question how he got into this.
GOOD LUCK
myfrogger
Thanks for the reply. The auction the city has is an online auction which is an everyday type of deal. Each property listed online has a day when a bidder can go and walk through the property and an end time and day where no more bids will be accepted. The city also allows land contracts to approved bidders. I think their credit score must meet certain criteria. She doesn't have an "in", everybody can do the land contract thing.
I just wanted to make sure she isn't doin anything wrong before I attempted to try the same thing.
Then if that is the case, if I LC a house to a buyer, they could re-fi in 2 yr and get a loan at the appraised value and pay my loan off and if they wanted to have money in their pockets to pay bills, or whatever? Is this right?
quinn
Quinn,
Based on what you said everything is correct. The loan part can only be done if your buyers qualify after two years. If they don't they will not be able to get a loan
Sounds like a plan
Lori.
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