What really happened to "dreamhome1922"
"We have been renting for the last three years and were not planning on buying for another year, but we happened across the PERFECT house for us. Long story short, we came to an agreement with the owners for a land contract and even had the inspection done. At the last minute, the owners decided they no longer wanted to do the land contract and offered to sell it to us outright for $10,000 less (for $105,000 instead of $115,000). Since we cannot get a loan for at least 6 months (probably more like a year) we were devastated. We also felt completely betrayed, since the owners allowed us to go through with a $300 inpection when unbeknownst to us they were having second thoughts. The realtor who is representing both them and us suggested as a last resort for us to try to find a private investor. Can anyone out there PLEASE HELP us find a private investor or another way to keep our modest dream home from slipping through our fingers? We have about $4800 to put down. Thank you!"
Dream Home, Sorry your dream bubble burst what was the story with entire deal for this house? It sounds to me like they were going to do a rent to own.. and the seller backed out. Was your credit history and mortgage prequal bad?
Two things struck me as suspect about your deal. First, be thankful you only lost $300 on the deal.
Second, please, next time get an attorney to draw up the land contract.
Third, get your own realtor to negotiate for you.
Homes are very personal to both the buyers and sellers. The reason the home was on the market so long is the seller isn't willing to negotiate. You being in the same room talking with the seller did nothing but insult them. The minute you talk repairs, they stopped listening with their heads and started listening with their hearts.
If you get a land contract, you can't change a thing about the home until you secure the loan. Until then, it's not your home...it's still theirs.
So sorry this didn't work out for you (I know you're crushed and broken hearted). The good news...I suspect this home will still be on the market for another year. Good luck to you.
I don't see private investors as the best answer. Though if the other Realtor suggested that as a solution, come back at him and ask: "That sounds like a possibility. Can you direct us to any?"
You can also find private investors by going to http://creonline.com. Click on the link for investment clubs in Ohio. You'll find plenty of groups, and there are private investors involved in all of them.
However, the basic strategy for a private investor would be to buy the house cheaply and then sell it to you, perhaps on a land contract, or using a lease-purchase or lease-option. For that to work, the investor might pay the sellers $65,000-$70,000 or so. The sellers would have to take a pretty big price hit. Another possibility is the private investor lending you the entire amount ($105,000) at a comparatively high interest rate with some points--for instance (just making this up) 8% and 3 points. That would cost you about $3,000 up front in points. The loan would be amortized for 30 years, so your principle and interest would be about $770 a month. However, it'd be a relatively short (say 1 year or 18 month) note with a balloon payment. So you'd have 12-18 months to refinance and pay the investor off.
Also, how long has the property been on the market? That is, if it's been on for a while, to use the old cliche, a bird in the hand is worth two in the bush. How likely are the sellers going to be to find someone to buy the property at its current price? There aren't many hot markets in the country; the sellers may have made a big strategic blunder by losing you and not having anyone else to buy outright.
Another question: Why did the sellers change their minds? Apparently they don't need all their cash out right away, since they were willing to do a land contract with you. Maybe just seller's remorse? That happens. But if you have any sense of why they changed their minds, that would help greatly in proposing something to them that would take care of their concerns while getting you the house.
Hope all that helps.