Referral from the daughter (Whom I sold a home several years ago) of a first time buyer, 55+years old, never owned home in her name, had been renting ever since her divorce several years ago. Fixed income, OK credit score, not enough trade lines to get a loan. Wanted a small home for her.
Worked with a first time Investor who lost a job when GM pulled out a few years ago, but had enough money in IRA for his own investment. After some consulting sessions, had him convert IRA to a self directed through Equity Trust Company, had the IRA finance the transaction on a HUD owned property in an owner occupant period, and had enough money for the rehab on a package loan to the buyer. The buyer gave a mortgage and a note to the Investor for purchase/rehab/profit
Lot of coaching/mentoring went into the deal along with a lot of TRUST, but got it done after a brief delay due to condo fee lien against the property. A few things accomplished in this creative deal:
- Made a home owner out of a long time renter
- They liked the house and most things are being updated as a part of rehab
- Investor was able to use his IRA funds to fund the purchase and rehab
- Investor makes decent profit, when purchaser refinances the deal paying off the mortgages
- Investor created a good chunk of equity via the notes
- The purchaser paid extra buyer agent fee for all additional work
- Converted a non-performing asset to a owner-occupied property, County will start collecting taxes now
- The General contractor is also a contractor for condo association, created work for his crew
- Created work for sever other contractors and suppliers
- Condo association got their delinquent fee collected before closing to release lien
- Buyer's total payment including taxes, insurance, condo fee was kept about the same as her rent
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