Homeowner's Sale That Turned Into A Deal

When I am out looking for real estate deals on a regular (daily) basis it seems that about once a year I will knock one out of the park.

Some deal will come along and it will just be unbelievable.

The problem is you never know where it will come from and it may start out not looking like a deal at all. Then something just happens.  For example…

I was working on a deal that Fred had found, he wanted me to go in as partners but I was not that interested in working on a homeowner’s sale.  So I decided to just help him out a little and let him have the whole deal.   A lot of people consider these sales a waste of time because usually the people are only $2,000 or $3,000 behind in their payments.  Most people who have a $200,000 home or condo are not going to run away because they are having trouble coming up with $2,000.

The other problem with the sales is the title you end up with is somewhat questionable.  Some title companies don’t really consider that you bought the place for several years to see what the old home owner is going to do.

Anyway, back to the good deal.  There was a condo that was going up for sale because the homeowner’s dues had not been paid.

Fred bought it at the sale for $2,000.  This is no big deal because 99% of these condos will have loans on them for the full value of the condo making them almost worthless.

This particular condo had a giant loan on it, but the lender had already conducted the sale and taken the property away from the home owner.  So legally the property now was owned by the bank and there was no longer a loan on the property.

I called the bank and asked them what they were doing, the loan they had was insured by the government so they were just waiting to get paid off so they were not concerned about the homeowner’s sale.

To make a long story short, Fred ended up paying $2,000 for the property which was free and clear (had no loan), and sold the condo for $200,000.

Making a $198,000 profit on a deal that I was not interested in.  Now I wish I had taken Fred up on his offer to be partners… Next time.