need advice fast- assignment

[denvergirl]

Hi everyone,

I am very new to rei and I have one deal right now that I am not sure what to do about:
I have this seller right now who wasn't able to sell his condo for 6 months and is ready to sell it to anyone, but not too much below market value.  I am kind of afraid to take it under the contract because I may not be able to flip it ( this would be my first deal ever).
I've advertised this property  5K above what the seller is asking and looks like there might be couple people who are interested in it.
 
What should I do?

[rajdash]

The purpose of a flip (wholesale) is to have enough equity after the aquisition to still have profit for you and either a retailer or another investor. If there is less than 205 equity, move on. He may be stuck a few more months or maybe he sells it to someone else.

Consider a lease option and put  renter in there if the monthly profit is attractive and the condo is in an area that appraises well.

Good luck.

[denvergirl]

Thanks.  The property is paid off.
What should I do in terms of logistics?
Get contract from a lawyer?  How do I make sure the contract is assignable?
How can I make sure I can get out of contract if I need to?

[rajdash]

You cn actually use an assignable contract found on the internet! you may be better off typing a letter and have an attorney look it over. To make it assignable, simply add "or assigned" after your name on the contract. 1234closures.com is a pretty good place to look,  partly because they have an office in Colorado and many links.

Two popular escape clauses are using an inspection (specify a period, specify passing inspection, not using a licensed inspector, then yu can get a contractor who is willing to do a free estimate for minor updating). A second is using a partner, or financing from a specified company (who can be a hard money lender) who will triger a release at your whim). Finally, give as little possible for a deposit ($100, if possible) that is all you will lose if he fights it. Make sure your contract specifies sole remedy for seller is the deposit, if you fail to perform.

[denvergirl]

thanks!

[bw1411ii]

Hi Denvergirl,
 
  He doesn't sound too motivated.  You may be able to do some creative financing, since he owns the property outright.  If he is willing to take a 2nd, with balloon payment at a future date, no interest till (whenever), or something along those lines, you can make the property more attractive to other investors.  

  I'd be cautious.  The Denver Condo/Townhouse market is feeling a little soft, right now.  

Good Luck!

[denvergirl]

Thank you for your advice!