Tricky SubTo Deal? Need Creative Solution
Ok, ran across another potential deal. Maybe you guys can help me figure out a creative way to structure it. This one seems really tricky but the payoff could be great:
3/2 house supposedly worth $170-$180k. Location is right next to a major throughway. ReMax is trying to put together an "assemblage". The neighbors houses on the same street of similar design have signs in the yard at $250K+. The homes across the throughway sold to a developer at $600K/acre. They built townhomes. They are assuming that this can happen to them?.
What exactly is an “assemblage”?
This seller doesn’t want to gamble on this assemblage and wants to stop being a landlord. He is willing to sell me his house for $175K. If I go get a note for $175K there is no way the rent I could charge would support it.
I was thinking to try to offer to buy his property SubTo his existing mortgage (he took a note for 72K in 1999) so I could have a good cashflow and give him a note for the balance due when the property sells thoguh this assemblage thing. I would give him the rest of his asking price of 175K and we would split any profit from there. I doubt he would take this. His only advantage would be no more landlord/property headaches while he still waits on the big payday.
Creative ideas desperately needed please!
This brings me to a general question: How does one buy and hold in a rapidly appreciating area (no cashflow)?
JohnCl
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