Unique Situation In NJ
I have come across a probate situation as follows: My daughter is friends with someone whose uncle stabbed his wife 38 times and then killed himself by slitting his own throat in the house they lived in. They had three children that , thankfully, where taken away by the authorities before the occurance and placed with the uncle's brother, who is doing well finacially, but is not a millionaire: 2 kids in college, a mortgate on a house in one of the best towns in NJ. I am perceiving the estate as an emoitionally distressed and motivated seller of the house in which the murder/suicide took place, and would like to take the property off their hands quickly for the mutual benefit of all concerned. Here are the financial stats: They bought the house, a 4 BR, 2.5 Bth, 2-car garage, in-ground pool, etc, (beautiful house in an outstanding neighborhood) in 1999, morgtaged 131,600. If memory serves me correclty, I think interest rates at that time were about 7% ( if anyone knows differently, please let me know.) According to the online tools of TÇI, the Estate owes approximately the full loan amount of 131-. The comps show that this house will sell for approximatley 355,00 - 398,000. I'm assuming, due to the circumstances, walls and carpet might be filled with blood, so rehab entials new carpet throughout and professional painting. There is lots of equity here. Checked the County Clerk's office; no liens on the property. Here are my questions: Does anyone have any helpful hints on the wording of a letter to the Administer of the Estate , who may be a family member, expressing my interest in the property? Such a sad situation; I don't want to come off as a vulture of any type. Second, if and when they contact me, how do I structure the deal? This is what I'm thinking: They owe 131,000; house is worth, after "clean-up," easy 350,000. I'm looking to flip it. I would offer 200,000, (69,000 cash to the Estate after mortgate is paid, which is 57% of "easy" FMV. I would then like to flip it at 245,000, which is 70% of FMV, netting me 45,000 (not including closing costs, which I would like to pass on to the end buyer.)? Second quesiton: where can I find an investor who wants to buy this property at 70% of FMV and do a double closing quickly so I don't have to come up with any money
In the circumstances you describe I would do a number of things simultaneously, 1) I would send a card of condolences to the family, reminding them of the relationship with your daughter and offering to be of help in any way you can. (this is an honest and sincere offer) Do not mention that you'd like to buy the house or help in selling it-- just express your condolences.2) I'd check on who the lender is on the first mortgage and attempt to purchase the note even if I had to pay full price (though I'd start out asking for a discount). Under the circumstances no local lender is going to want to be seen as the forecloser, yet the odds are pretty good that they note's going to be in default pretty soon.3) I'd check with the probate court in your area and find out who the executor of the estate is and what law firm is handling matters. Given the emotional truama I'd much rather deal with the attnys than the family.
When you know the answers to those questions get back to us.
Oh, by the way. It is much to early to be trying to figure out how much you are going to pay or how you are going to structure the deal. As that great real estate investor, Sherlok Holmes put it "Its is a capital mistake Watson to let one's theories get too far ahead of the facts."
Thanks so much for responding. I will do the things u suggested and get back.