The Anatomy of a Killer Deal…
I was talking with a customer the other day about an unbelievable deal she closed and I have to tell you about it. Now I’ve heard about deals like this before but I still get astounded at how much money someone can make from our motivated seller leads subscription service.
She received the lead through her email and immediately called the seller. The seller had contacted other online and offline services to sell their home but this gal was able to close the deal because she took the time to understand the woman’s situation and even gave her some money out of her pocket to help the woman get by even before she closed the deal. The seller had a small child and an ex-husband who wasn’t paying his fair share.
Just like so many people in these situations just 1 thing can put them over the hump of insolvency.
Well this motivated seller didn’t just have one thing go wrong, she had all sorts of problems. First the heat pump went, then the roof started leaking and then she really couldn’t keep up. She had to move out of the house but not only did she have to pay rent, she also had to pay a mortgage on a house she couldn’t live in! The worse part is that now she has a house in complete disrepair that no retail buyer could get a loan to buy and if she was able to sell it may take months. She couldn’t financially handle things today, how could she wait months to sell and then have to pay an agent’s commission? She was definitely in a bad situation.
In steps our professional real estate investor. She moves fast and takes the house subject to the existing $85,000 mortgage, brings the loan current by paying $1800 in back payments, $1300 in back taxes and then gives the seller $30,000 in cash. The repairs on the house are going to cost at least $25,000 and here’s the punch line - the after repair value (ARV) is $250,000.
For those of you good with math you know that’s a $107,000 PROFIT!
This smart gal’s going to do the repairs (being her own general contractor) and then refinance the mortgage leaving 20% equity in the house. That means that this savvy investor will pull out $57,000 tax-free cash at closing and get a $50,000 2nd line of credit (LOC) to fund future deals. She’ll deduct the mortgage interest against her other income and plans on renting out the house for as long as she can, letting the tenants pay for the property while it steadily appreciates in value.
Now if you assume that this lead was the only lead she received from our lead subscription service all month, the return on her investment is 2678% (yes, that’s two-thousand, six-hundred and seventy-eight percent). With those numbers she’ll be able to pay for her subscription for the next 223 years!!!
I hope she makes it!
Make a Comment | Discussion Forums
REAL ESTATE INVESTORS:
Talk About Real Estate Investing In Our Forums!
Click: REI FORUMS
Make A Comment: ( None so far )
You must be logged in to post a comment.
