Help a friend?

[raydan]

 ???   I have a friend from work who is in some trouble and needs to get out of his current house because he is having a new one built.  Him and his wife have poor credit and he only wants 107K (the amount of the mortage).  Houses on his street are selling firm at 117 to 125K.  So, do I move on this, I think I should but just wondering being this would be my first investment, should I do it?   Believe me I want to, but don't want to start off unethically or anything like that.  Please give me advice as of what to do that will be 'good' for both of us.  

Thanks.

[tedjr]

Howdy raydan:

If you can get it for zero down and take the loan sub2 and it is in good condition and you can lease it out the first day you put it on the market for $300 plus per month positive cash flow it will be a good deal. I  bet a  steak dinner for two  that you can do none of the above.  There is not enough equity to do anything else with the house. If helping your friend is your major objective then give him some money and help make the payments until he can sell it. I would not worry about taking advantage of him by doing the deal. If they only owed $30,000 and you wanted it for $30,000 then you would have a problem. I do not know where the dividing line is but at $107,000 you are over it by a mile.

Hope this helps some and is just my opinion of course