OMG What Do I Do NeXt PaRt 2!!
hello all investor dudes/dudettes:
seems like this forum gets more hits than the beginner/birddog one so i'm here too.
well i'm not sure if any of you remember my old post: OMG What do i do next? but ums.. .heres the update and heres what i came up with. Any advice would be great, but first lemme give you some background.
Motivated seller (disabled and recently divorced) is willing to sell me his house. He responded to my mailing. here are some numbers.
-He bought the house 3yrs ago for 120k.
-Says that a recent tax statement said the house is worth about 130k. (i maybe think it might be worth a bit more, nice neighborhood and subdivision)
-he owes 83k and has about almost 3k in backpayments.
-he would like to walk away with 20k for his equity.
-needs a paint job on the inside, other than that its all good.
Now here is how i structured the deal and i pondered this out a lot. So being that this is my first deal, i have no real liquid cash to work with, or at least not a lot. (due to a recent car accident, i have some to work with)
i'm going to buy sub-to existing financing and also sub-to finding a TB or retail buyer. i'm going to make the backpayments and repairs.
so i'm going to buy the house for what he owes @ 83k and have him take back his 20k he would like to walk away with as a 2nd and paid in full within 120-150 days, less closing costs (for a retail buyer). For a TB, he would take back the 20k and get a balloon payment anytime within 5yrs w/ an equity split of maybe 5-10% after selling, should the TB exercise their option. (the equity split is if he wants an interest payment on the 20k, which i dont have the $$$ for the interest payment, i figure maybe i could buy him off with that)
being that i dont have a lot of capital to hold the property, i'm going to invest my money in advertisement and marketing hoping to find either a retail buyer, or if not that a tenant buyer.
so once i find the buyer, i close on the buyer first and collect my check, then go back and pay off the existing loan and former seller.
Am I going about this the right way??? is there a flaw in my thinking or is there any advice you can give me???
please help me Obi-Wan Kanobe, your my only hope. 
[addsig]
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