Deal Deadlock
Hi all, can you take a look and see if you can come up a solution to this? Thanks, Brian
The property, house #1:
91k 1st
2500 minor repairs
Mortgage is current
ARV 105k-125k. (Depending on which realtor you talk to) 3 year old appraisal at 113k
The seller:
Needs 5k cash for creditors
Has a house in mind for me to purchase, he buys it from me later
This house is in good condition and worth the price
The Deal:
I give 5k to the seller, he deeds the property over to me
I buy the house #2 on his behalf and he pays me to live there
He can pay 1500/mo. The PITI is approx 1200.
When his credit is repaired he buys and we divide equity
The sticking point:
He wants to be on title to the property.
It’s on my credit, I don’t want him on title…..I want to do a traditional L/O.
Is there a way to do this so we both win?
I would try to convince him that the mortgage payments for him would be much higher if he is on title, because of his credit score.
After all, if he is on title, he needs to be on the mortgage. No legal way around it without your total agreement.
[addsig]
With all due respect, why are you wanting to even do this deal?
When you add in the repair costs, the house you would be buying from him would barely be 10%-12% under market value. Not to mention all of your other costs. There’s no way he could come close to getting that much if he sold conventionally.
You say he needs $5,000 for creditors. But you also say he can afford $1,500 a month. What assurance do you have can afford anywhere close that?
Also, why should he get a split of anything? He has absolutely zero into the deal and zero exposure… and he wants to be on title? He’s got to be kidding.
Maybe I’m missing something here, but the whole thing seems a bit crazy to me.
Just my 2¢