Seller wants 50k for his deceased mothers house, he grew up in it. He owns it outright. Off market deal.

Full rehab could fetch 99-115k for a flip, needing 24k to complete project. Offering $30,500 cash

Could rent as-is for $700 needing $6,000 for some basics. Offering $35,788.

I could turn and burn flip it doing almost nothing for about $2,000-$3,000. I would list it at $69,000 and should get $59,000. Offering $39,000.

The offer prices are explained in the letter.

This is the letter I plan to send him.

Hello Mr. Seller, thank you for taking the time to show me your house the other day.

I've worked up a few scenarios that may work for the property. I don't know your personal situation, so I am providing a few for you to look over and choose from.

The 1st option I came up with was $39,000 for the house. I would like to put $3,000 down and pay $200 a month interest only until I can get it sold and pay you $36,000 when I sell it. This would be for a maximum of 10 years, but could be as short as 6 months. The $200 a month works out to 6.6% interest per year on the $36,000.

The next option I have would be to pay $30,500 cash as-is for the house. I don't want anything fixed with this option and will take care of any and all issues with the house. I can close in 2 weeks of acceptance.

The 3rd option will get you the most money, but requires flexibility on terms. This option will give you $52,576 total. The purchase price will be $36,788. I will give you $1,000 down and $149 per month for 20 years at 5.25% interest. This will give you an additional $15,788 in interest.

Like I said, I don't know your personal situation. I am open to any option, as all will work for what I do with homes. I also have references from people who I have done other deals with similar to this.

Please let me know as soon as possible as I am looking at a few different properties.

Thank you for your time. I look forward to hearing from you soon.

You both agree... The house needs the money?

Twice you write that u don't know his personal situation.

Why do you say that?

If he has any business sense at all, he'll turn you down for #1 and #3..... what is the advantage to him other than a few extra dollars and a lot of risk.

I agree with meeting him.

#2 would be my recommendation.

$35,500, cash, close when title work is complete.

The 6.6% interest

or

5.25% interest are too low for seller financing. If I was the seller I am taking a risk with owner financing.

A higher interest rate and a higher down payment similar to hard money lending.

HOWEVER that being said if the seller is in the mind set to unload the property he or she may take the money at a much lower rate and more power to you NE of PA.

Cash is KING so make a lower offer than the $30,500. maybe $25,000 and let the chips fall where they may. He may take it. OR tell you to hit the bricks but you don't know until you ask!!!

Tom - I just sold an investment property. We got many offers (like 15) - 12 of which I didn't even respond to they were so ridiculous. Like $100,000 under asking on a $270,000 property. Seriously, in 50 years around real estate I have never encountered so many absolute idiots. Everyone reads sites like this where people buy for 10 cents on the dollar, or watches HGTV and listens to these "gurus" saying if their offer isn't insulting it's too high.

Do you know what he’s planning to do with the Cash?

That will determine whether he finds owner financing attractive or not.

If he won’t come off his price offer him $50K with $1000 down and 196 payments of $250.00 or something like that.

Backing up quickly, I get the mortgage and taxes information out of them during the initial phone call. I also get out of them why they are selling in the initial phone call. Then sometime during the showing, I get the mortgage and taxes information again from them in person along with why they're selling. I act like I don't remember discussing that with them just to see if they say anything different the second time to check for any holes in their story.

The mortgage and taxes are current on this property. There is no mortgage actually. He is selling because he lives about an hour away now and can't get up to work on it like he likes to. I asked him what he would do if he can't sell the property and he said he will either keep it or keep it for one of his sons. To me, that puts his motivation out about a 75%.

I'm not 100% sure that I can close this deal that's why I was just going to mail him a letter. If I was a 100% sure that I can get this deal, I wouldn't have posted this and I would have it under contract already.

I can go back and show him three offers in person, I have never done that though so I wouldn't really know how to present three different offers other than on paper. He's not going to really care what all I have to do to the property to get it to a full remodel condition or anything like that. He cares about his situation. I asked him where he came up with this price and he said some online research. Bogus #.

He wants the money to fix up some things around his own house. He's not desperate for the money, from what I can tell. That's what changes the game a little bit.

The numbers that I presented in that letter will make the property work. It's just a matter of getting them to work for him.

NE, I agree you're on the right track to make different offers and let him choose. That said, let's get that letter as simple and easy as possible.

Bullet points. Get rid of sentences. Example:

Option 1:

* Sale price $39,000

* Down payment $3,000

* Seller financing, $200 per month, interest only.

* Balloon payment in 10 years of $36,000. No penalty for early payoff.

Outline the rest of the options this way. No flowery or unnecessary language.

Keep is simple.

LiveTheDream of AZ, Congrats on getting your investment property SOLD!!!

You got many offers (like 15) - 12 of which you didn't even respond to they were so ridiculous. I disagree with you to ignore the 12 low ball offers. Sure they were ridiculous. And maybe they were idiots! Buyers are wanting the property for the lowest price and sellers are wanting for the highest price and there is a middle ground. AND its possible that a seller may have a bidding war on the property due to a hot market. There are several that can not afford the asking so they are testing the water to see what happens. OK so they move on and you move on. Make the counter offer, plus depends on contingencies as well.

So what if it's $100,000 under asking on a $270,000. Make a counter on the offer.

Some buyers that continue to make low ball offers and have looked at 20 to 50 properties. THEN maybe they will realize they are in a hot market and need to adjust their offers in the future. OR it may not be time for them to buy. OR they need to focus on their affordable price range.

NE of PA, I would go below the 10% rule and make the low ball offer. Now the seller can continue to have expenses holding the property for his son. If the seller wants to hold the property NE of PA will move onto the next offer, more power to him.

Buying distressed properties is a risk for the investor/flipper/buyer.

Best of Success NE of PA...

My experience as a Realtor is that the more options you offer the harder it is for them to a) grasp and b) decide.

You need to remember that very few people buy or sell frequently and are generally overwhelmed by the process especially with estate sales.