Full Retail Minus Repairs

I mailed 114 probate letters on Wednesday last week which represents about 80 decedents. I got a call from a guy on Friday (happy birthday...) that went exactly as I had planned.
Check this out...

When I came home from the post office Wednesday night after dropping off my latest batch of probate mailers I told my lovely bride, "someone from this batch is going to call me and say 'I want you to buy my house." " I just knew that someone from this batch was going to call.
So, I wasn't surprised when my cell phone rang Friday night, on the way home from job #1, I took the call and he said, "hello Scott, My name is *Bill* and I want you to buy my house." Just like that. I actually chuckled a little bit and then went into my 'find out if they're motivated' script.

The discussion went well and he pushed off any discussion of price with the comment, "we'll talk about that when you come out tomorrow." No problem, I thought, the loan is low enough that I could take it over and get this guy out of trouble and still have enough room to make a little bit of money.

Here's the details: Built 1959, 1539 sq ft brick rambler, 3BR/2Bth with a new comp roof and new AC unit. Owner estimated that it would take $25k to fix it up and get it looking 'perfect'. Bathrooms needed work and the kitchen floor needed to be redone. It comped at $355k on realquest.com and the assessor's website had it at $307k. The loan on the place is down to $145k so I thought we'd have some room to talk about it...

Next morning I brought my brand-spankin' new foreclosure researcher with me to look at the property. The co-executor/sister was there and it turned out that they now wanted to get what they could sell it for on the market minus repairs. When *Bill* and I had talked the night before, he spoke of 'getting rid of this thing' and 'I'm too old to tackle all the work that needs to be done here...
"What do you think it would sell for if it were fixed up?" I asked the sister kindly.
"Oh, about $365,000," she said. I let out a "ha!" before I could stop myself.
Next I asked how they came up with that amount.
"Oh, from looking around the neighborhood at other houses around."
Market research I thought... what a novel concept.

"If we don't get the price we need to, we can wait this market out. If worse gets to worse, we can just rent it for more than the mortgage payment. Hmmm, the motivation level must have dropped overnight..."

So, in the end, they were looking for $365 minus the $25k in estimated repairs which brought us to a grand total bargain price of $340k. My max offer was in the 180k range and that was going a little light on the repairs (my estimate was a little closer to 35k.) So, in the end I wished them luck and went on my merry way, having looked at house number 19 in my quest for investment properties. They say that you need to look at 100 properties before you buy your first. I've seen the outside of that many, but have only had 19 face-t0-face mtgs with sellers. Many more to come.

My birthday was awesome. Great times with my kids, a great night out to dinner with friends and a couple of great birthday gifts to boot. Thanks everybody.

On the Foreclosure front, my researcher/doorknocker signed his IC contract on Saturday and was supposed to go out knocking doors this morning. He's an IC, so I have no control over whether or not he goes out, but I should hear from him soon and I'll let you know how he's doing.

Best of luck out there!
-Taylor