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Posted by user on July 15, 2005, 3:04 am
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On Fri, 15 Jul 2005 00:03:27 GMT, "Steve Horrillo"
>Here's an article I spotted in www.creonline.com/success-stories. A fixer
>upper. Everyone made money... well... let's not even think about the the
>seller.
>
>
>$62,000 Net on a Fixer, and We ALL Made Money
>KD Neal, Southern California
>Thank you, CRE Online, for providing such a valuable resource. This site is
>a blessing for those of us who want to learn from others who are so willing
>to share their insights.
>Here is how it happened: My stepmom told me about a woman she knew who
>wanted to sell a three-bedroom, two-bath home. She knew I was actively
>looking to buy distressed properties. (Tell everyone you know and meet--you
>buy real estate.)
>The property is in a rural, residential area and the seller wanted $125K
>because the property needed work. I ran comps that evening and found the
>property was worth at least $180K. I ran my numbers and met her a couple
>days later at the property. Once there, I discovered that the property was
>on over an acre of land and only needed about $15K worth of work.
>I offered her $90K net cash on the spot. Her daughter called me two hours
>later to tell me her mom accepted my offer. I called my cousin who has a
>line of credit through a hard money lender to buy real estate and offered
>her 50% of the deal. Here are the numbers from purchase to selling:
>Purchase Price: $90,000
>Hard Money Loan: $109,800
>Lenders Fees: 8,528
>Title & Escrow: $2,910
>Disbursement: $776
>Rehab Account: $15,000
>Closing Costs: $7,411 ($7,000 borrowed from girlfriend)
>Selling Price: $160,000
>Payoff 1st: $112,845
>Title Charges: $1,101
>Escrow Fees: $985
>Final Audit Funds Held: $350
>Net Check: $44,719
>Rehab Refund: $15,000
>Seller Paid: $3,000 (in extension fees for two delays in closing.)
>Total Profit: $62,719
>
>Stepmom Receives: $1,000 finders fee (Doesn't know it, yet.)
>Girlfriend Receives: $9,000 back for short-term $7,000 loan
>Cousin and I Split the Rest: 50/50
>
>Now it's on to deal number two; wish me luck!
Hard to say exactly how the seller felt about it. Feelings are so
'individual'.
But the seller got exactly what he agreed to, without a gun being held
to his head. What someone else does afterward when it becomes their
property shouldn't even equate into the subject.
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