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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: Bidding formula for foreclosures Posted by john wilson on August 28, 2006 at 10:30 AM In Reply to: Re: Bidding formula for foreclosures posted by Joe on August 26, 2006 at 9:57 PM : I would want to make more than $5k when I'm sinking $135k into a deal. Your sale price could easily swing $5k to get it sold. I'd estimate for a $15k or $20k profit minimum. Use his note. Don't terminate it. Just have him move out, you fix up QUICKLY, and sell and pay off note then. I'd run the numbers this way: $165,000, less 4% broker $6600, less 2% closing $3300, less 6 months holding cost $7000, less $1/s.f. interior paint $1400, less $1/s.f exterior paint $1400, less $1000 landscaping, less $2/s.f. carpet $2800 less $2000 furniture rental (staging) less profit $15,000 less fudge $5,000 Would Calculate to $120,000 being your top offer. So tell him you'll give him $10,000 when he moves out (difference between value and note). Perhaps you can do it where the $10,000 is for an option he extends to you to purchase the house for $1, within two years, and for you to take possession (lease). You would record the option to preserve your position in title. Obviously run that by your lawyer. So if he doesn't go for the offer, you need to decide where you can cut cost out of that $45000 of expenses. Also, if he doesn't like the offer, just run the numbers with him on the spot (have your handy pocket calculator ready). John Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : : I would want to make more than $5k when I'm sinking $135k into a deal. Your sale price could easily swing $5k to get it sold. I'd estimate for a $15k or $20k profit minimum. : Use his note. Don't terminate it. Just have him move out, you fix up QUICKLY, and sell and pay off note then. : I'd run the numbers this way: : $165,000, : less 4% broker $6600, : less 2% closing $3300, : less 6 months holding cost $7000, : less $1/s.f. interior paint $1400, : less $1/s.f exterior paint $1400, : less $1000 landscaping, : less $2/s.f. carpet $2800 : less $2000 furniture rental (staging) : less profit $15,000 : less fudge $5,000 : Would Calculate to $120,000 being your top offer. So tell him you'll give him $10,000 when he moves out (difference between value and note). Perhaps you can do it where the $10,000 is for an option he extends to you to purchase the house for $1, within two years, and for you to take possession (lease). You would record the option to preserve your position in title. Obviously run that by your lawyer. : So if he doesn't go for the offer, you need to decide where you can cut cost out of that $45000 of expenses. Also, if he doesn't like the offer, just run the numbers with him on the spot (have your handy pocket calculator ready). : John Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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