Anyone know what those signs "cash for your homes" pay for homes

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Rx Wizard
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Not looking to sell my home but looking to see if I partnered with another person and bought homes for cash like this (one at a time obviously).

What is the story on them? There signs are everywhere. Has anyone inquired about them? Seems the whole leverage thing is a big thing when buying real estate but this must be more benificial as you must get real estae REAL cheap with obviously no fees added on.
 

WVU

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"We buy ugly houses" signs are all over the place down here. They are hoping to buy for big discounts, I imagine 20% or more.
 

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yep, they prey on fools that dont know the value they have.
 

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Some people are in desperate need to unload property and they want to sell to a buyer where it can close fast, no mortgage approval, no inspection contingencies, etc. That's where cash buyers come in - they lowball them on the price, and scoop up real estate. I remember even in the hotter housing market, cash buyers were still getting real estate for 15-20% less than the asking price when identifying someone who had to sell quickly.
 

Whatever
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Better to get in with a bank and get heads up on foreclosures. They are happening at alarming rates these days. That way if the bank has you in their pocket as a resource for possible purchase of the note. This way you can negotiate or just assume the note and they are clear. Good way to get houses at a great price.

Only problem is trying to sell the thing in this market.
 

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I've got a realtor in Miami who sends me need out deals all the time (Probably once/month) - they are usually people either arrested for drugs or being kicked out of the country. They always require cash and a close in like 3 or 5 days. Unfortunately, most of these deals have been in the $2-8 million dollar range so I dont know why he keeps sending them to me.

I vividly remember one that was 3 units at the Icon on South Beach that had been combined. Fair market was about $8million at the time. They wanted 3.3 cash in 3 days. I called every person I knew with money, but none had the balls to get it done in 3 days.

-Sean
 

Rx Wizard
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I would have to assume it would have to be 40% off listed value of home for it to be something for them to do. Seems like a way to make good money.

Thinking about going partners with my brother and calling/knocking on doors of sellers who are selling for 100k or so and offering 70k cash to close in 2 weeks or so. Wondering if anyone will bite as there are quite a bit of homes in my area having problems selling these days and the market is flooded with homes in that range. You could re-fi for 100k or so and take out 30k in profit. Basically sellling to yourself. Do 3 of these (on your own) and be up close to 100k and rent them out till market turns back around.
 

Rx. Veteran
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I think the best time to buy over-all is going to be around Christmas. A lot more folks will be in a bad cash position and prices will have come down, as reality sets in. You're going to see some desparate people around XMAS.
 

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Iceman, there is a book I read basically descibing exactly what you mention.

It is really the way to go after real estate. Along that method, you NEVER pay any taxes except for on the rent.

One annoyance is that you will have to pay fees twice if you finance and then refinance. The first bank will only finance up to the cost of the sale even if appraised higher. (I'm still looking for a bank that will do 80-90% of appraisal even if more than the sale, but can't find one) Most banks make you pay the damn fees twice.

Another option is to pay cash.

Another option is to pay via lines of credit (Still fees) and immediately refinance.

Bottom line is there are some great bargains out there.

I personally like areas near large univerisities where rents are going for 1.4X mortgage +. There are some places near Ohio State where rent is twice the mortgage.

Buy at 75% of appraisal, refinance and take money out, rent for 5 years, refinance and take money out, rent for 5 years, repeat...

Sean
 

Rx Wizard
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Iceman, there is a book I read basically descibing exactly what you mention.

It is really the way to go after real estate. Along that method, you NEVER pay any taxes except for on the rent.

One annoyance is that you will have to pay fees twice if you finance and then refinance. The first bank will only finance up to the cost of the sale even if appraised higher. (I'm still looking for a bank that will do 80-90% of appraisal even if more than the sale, but can't find one) Most banks make you pay the damn fees twice.

Another option is to pay cash.

Another option is to pay via lines of credit (Still fees) and immediately refinance.

Bottom line is there are some great bargains out there.

I personally like areas near large univerisities where rents are going for 1.4X mortgage +. There are some places near Ohio State where rent is twice the mortgage.

Buy at 75% of appraisal, refinance and take money out, rent for 5 years, refinance and take money out, rent for 5 years, repeat...

Sean

always looking to learn. Do you (or anyone else) know of the books title? Trying to educate myself on this. From what I understand you may get a loan only at 80% of appraisial on these so now you are back to square 1 or square 2 on this. Maybe just hold and try to sell youself for less.
 

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