Posted by Ed Garcia on July 16, 2008 at 10:27:33:
In Reply to: 0 down loan with a fica around 615 posted by al on July 14, 2008 at 22:16:11:
Al,
I think Rich was being kind when he said that he felt that the Numbers are a bit thin.
Al, this is NOT a deal for an investor.
If the property is valued at $215K as you’ve suggested and you had to sell it tomorrow for full market not losing a cent which is a fairytale in this market, you would more then likely have to pay a 6% commission which is $12,900 not counting any holding costs, taxes, insurance, vacancy, cost for loan, etc you have paid not to mention if there are association fees. So to buy it for $198K there is no deal.
If you can get this deal with no money out of your pocket on a lease/option for $1300 a month and sandwich lease it for $1500 it could possibly be a deal but I’d have to have more information about the deal to know for sure. You’re so close to the vest on this deal a hick-up in the economy could find you owing more on the property then it worth.
Al, I know I’m coming on strong but I want to make sure you get my point because I don’t want to see you get into trouble.
As Rich said you need to learn your numbers, they tell you if you have a deal or not.
At a glance and on the surface you seem to think you have a deal, but trust me, your numbers don’t do the job.You need to make your money on the buy and it must CASH-FLOW.
This is a soft market and there are just too many opportunities and deals around to mess with a deal like this.
If you can’t find a deal in this market to make money with, this isn’t the business for you.
Like I said to one of my students who I felt was spending too much time with deals that did not merit. Why go fishing for Sardines when the Tuna are jumping into the boat.
Ed Garcia