subject: Making Lots Of Money With Probate Properties...... [print this page] Before you decide to make an offer on the property, do the math! Make sure the cost of repairs plus the purchase price on the house PLUS the profit you want to make will not cost you more than you can sell the home for.When you're looking at the home, determine what costs you'll have to incur to fix the place up. You can fix the place up yourself, or, if you'd rather just make your money and move on, grab your database of investors and find a buyer.
The advantage of probate properties is that you can be the bridge between the executor and a rehabber/investor if you don't want to make the repairs yourself, a technique called wholesaling. Wholesaling will bring your profits to a whole new level, while allowing you to work less (four hours a week), with less cash up front (no start-up money required), and using
none of your own credit (perfect for those with less than perfect credit). In fact, there is no reason why you cannot begin profiting from wholesaling right NOW. Since the typical investor/re-habber can pay cash for the property, closings happen fastwhich means your
profit happens fast! As you've been searching for properties in the probates, you've certainly come across those properties which require a more extensive amount of work to be considered sellable or livable.
For example, your probate house is for sale for $50,000 and three comparable homes in the
area just sold for $120,000. It will take $16,000 to rehab, leaving $54,000 to play with. Make an offer on the house for less than the asking price (somewhere between $42,000 and $48,000 depending on your market). Keep inmind that you are only acting as an intermediary herethat your work is simply finding and securing the rehab property and that the
investor/re-habber will want to profit as well. Then, you contact your list of investors and let them know you have a $120,000 property (after rehab) and offer it at $62,000. You make $14,000 without doing anything more than matching up the executor with the rehabber.
Rehab yourself (this takes more time and money), and you'll make nearly three times the profit, but you run the risk of repairs costing more than you expected and of not being able to sell the property at full price, too. And $14,000 isn't bad for an afternoon's work.
