House #39 – It’s SOLD!

It has been almost a month since I last wrote about House #39.  If you haven’t checked it out, have a look this is one of the Flip this Mansion houses we bought with numbers very similar to House #26.

Our Buyer originally sent in a conventional offer with 30% down, but in our negotiations they mentioned that the Buyer is a business owner and would prefer to do an FHA loan, if possible.  I was not real excited about it, but the they did remove the loan contingency and appraisal contingency.  Since they had a decent deposit that would be non-refundable, we decided to proceed.

The negatives:

• Like with many FHA deals, it took over 45 days to close.  I am pretty good at following up with everyone but the conditions that banks requested took some-time.  Also, the Buyer works out of town on weekends.
• We broke our original budget on this house quite badly.  It still turned out to be a good deal for us, but not like the projections.  Most of the budget overages where just due to us not being as experienced in high-end homes.  Curved corners on drywall take a lot of extra labor, the custom sized skylights where very expensive, etc.  We also decided to upgrade a couple of the items as we saw the market changing.

The positives:

• The house is sold!!  Our monthly carrying costs with hard money on this one where quite substantial and I’m glad not to be writing those checks anymore.
• We navigated through a pretty big and problematic appraisal issue.  Originally, we had about a 10% value hit, but the loan officer made some magic happen.
• The Buyer got a great product for a fair price and we got paid for our efforts, which is always a good thing.

I hope we can find more like this one!

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