Win/Win Seller Solutions

Title Of Post

 I’m going to tell you about this more from the seller’s perspective if you’re reading this article and you’re more interested in the buyer’s perspective and how this deal was structured I will either be having another blog post come out in the future about that or send me a message and I’d be more than happy to let you know the mechanics of how a deal like this breaks down.

So how did the seller find me? Or how did I find them?

Here is the quick version – a friend of mine on Facebook, it was his mother’s house he had posted a small remodeling project that they had done recently at his mom’s house and was advertising giving away the old pedestal sink which was still in good shape. The old sink was going to work perfect for an apartment that I was finishing up. After installing the sink, I sent a nice message thanking him and his mother for the sink and that it was being put to good use during that conversation I mentioned if she ever wanted to sell her house or knew anyone selling a house to let me know. I am always in the market for buying some more investment properties. A few weeks later she gave me a call and asked if I would be interested in buying her house. So that’s basically how we met each other and how the deal started.

Now you might be able to relate to the seller because you might be in a similar situation or there’s a good possibility you know someone who is a friend or family member that might sound just like this.

 The seller is an older lady that is living alone in a house where she originally grew up. She had the idea of wanting to move into a retirement village but was not sure what to do with the property. It is dated, needs some work and she had been smoking in it for quite a long time. One of her concerns was putting it on the market having people walk through her house and inconveniencing her. I’m sure there’s many of you out there that feel the same way about putting your house on the market. Having a realtor and all of the potential buyers walking through the property and needing to have it clean or needing to have all your stuff put away or all the other hassles that would go along with listing your property onto the market. I also later found out and I feel this was one of her underlying concerns that she was going to be having some medical testing done and could possibly be having some health issues. Under the Medicaid regulations if you were to get sick and not be able to pay your medical bills your house and your assets become liquidated by Medicaid to pay your medical expenses. After doing this deal and after talking with two other people in the past year that I’ve had similar situations with their family members I’m starting to see how this could be a major concern and stress for anyone growing older. So why not just sell the house to one of her sons or another family member?? in the state of Pennsylvania they can come back and take assets within a certain time frame if sold or given to family members. (I will be doing a full story about Medicaid estate recovery so you can have more information about how this work. I will also have a page on the site with links and information so you can learn more.) By selling the house to me I’d be able to protect the house in case of a medical situation and I would be able to make payments to her and to her son into the future without the property being affected. One of her other concerns was she didn’t have an exact move out date and was waiting for the application process at a few retirement villages. So, if she were to list her house and someone would be interested in buying it, she would be needing to find an apartment or be inconvenienced until a retirement village accepted her to move in.

So let’s start solving some problems. Buying houses is more of solving problems and understanding people than it is about money and hot water heaters or refrigerators.

First the problem with Medicaid or any kind of life-changing event that is going to possibly impact your finances and assets. We were able to do a sale get the property out of her name and protected from these situations.

Second the concern of time frame before her application would be accepted to move into one of the retirement villages. We came up with the idea to solve this problem by letting her become a tenant with terms that would work for both of us.

 The terms where she would be able to stay there rent-free as long as she’d like. She would remain responsible for the taxes, insurance, and utilities just like she had been. We also made the agreement that any repairs that were going to be needed or necessary we would split 50% of the cost.

This makes a good win situation where as the buyer and owner I have very low expenses. There for being able to keep her in the home. It then makes her the tenant with liability protection and separation from the property.  

The third problem that we solved was her mortgage payment she had refinanced the house at one time and owed a small amount left on the balance around $20,000.

The solution was to pay this amount off and have it where her cash flow was improved a few hundred dollars a month by eliminating this payment.

As for my side of the win-win I now added an asset to my portfolio. The monthly expenses that typically need to be covered are still being handled the taxes, the insurance, the utilities being on, Etc. We structured our agreement in a way where I would be able to use the equity in the house if needed to continue growing my business. And the final piece of the puzzle was to give her a payment for her Equity that she had built up over the years and we structured that with a nice monthly payment over the next 8 years starting 90 days after she moves out so she’ll be able to collect a monthly check. This payment is also protected from everything and would be passed on to her children in case of an emergency.

Your content goes here. Edit or remove this text inline or in the module Content settings. You can also style every aspect of this content in the module Design settings and even apply custom CSS to this text in the module Advanced settings.