Dallas-Fort Worth Real Estate Investor Club

Probate question

  • 01 Jun 2012 9:43 AM
    Quote
    Message # 940056
    Deleted user
    Hey DFW REI Club! Haven't been on in a while - sorry! 
    I'm in need of some advice on how to handle a probate situation. 
    Some background:
    I recently put an offer in on a probate house where the administrator lives out of state. The judge has now become the decision maker on what offers to take on the house based on an appraised value that is way too high. The decedent passed about 4 or 5 months ago and the property has just been sitting there with no movement. It's got a great layout and is in a prime location (right off 820/121 connection in Hurst) but it needs a TON of work. 
    My questions are these:
    Should I wait a few months and try again? Should I submit the same offer every week? Should I order my own appraisal and submit that to the judge? Should I take photos of everything and submit them to the judge for review with supplemental estimates from contractors on how much the work is going to cost?
    Are there any other tactics I can use to get the judge to change his mind? The appraisal is WAY overboard (by about 30k) and even if an owner-oc got in there, they'd have to drop 50-60k in repairs just to make it livable which is never gonna happen. 
    Thanks for the help guys!
  • 01 Jun 2012 10:18 AM
    Quote
    Reply # 940075 on 940056
    Tim Cook
    Sean,
    If it were me and I really wanted the house I would do the following:
    1.  Get a written repair estimate with pictures
    2.  Get a written appraisal in it's current AS-IS condition and what it would be with your list if repairs completed.
    3.  I would reconfirm comps and make sure you are using the right SOLD properties in your analysis and drive them and take pictures of them as well to show a comparison.
    4.  Maybe even get a realtor to write something for you to provide the Judge to support your justification of the offer
    5.  I would also highlight the Days on Market (DOM) if it's high as well for that area
    6.  Submit all of the above as a nice package
    7.  If you are connected with the heirs I would also have them tell the Judge they want to take the offer
    8.  I would resubmit every couple weeks keeping an eye on the property to make sure it's not being vandalized and if it is, lower the offer.
    9.  You win some and you lose some.  This may or may not work but at least you have given him the facts to work with

    To Your Success!
    Tim
  • 01 Jun 2012 10:27 AM
    Quote
    Reply # 940079 on 940056
    Jesus Galaviz

    Hi Sean,

    I'm no probate expert, but I'm guessing you shouldn't wait a few months if you really want to get this house under contract.

    If you get an appraisal, YOU will pay about $400, but EVERYONE involved with this property stands to get some benefit from it.  They might not even thank you.

    I suggest you take some pictures, as you mentioned, and pull the comps.  The comps will probably let you estimate the ARV of the property, as well as what physically distressed property in the neighborhood has been selling for.

    DISCLOSURE:  I have NEVER looked into, much less closed, any probate deals.  This is just my 2 cents.  :)
  • 10 Jun 2012 10:54 AM
    Quote
    Reply # 959912 on 940056
    Steve Labus

    Sean - Looks like you received some very good anwers to your question. I'd like you to notify me if or once you are able to lock this property up. I buy in the HEB area. Please contact me if this situation evolves into an eventual wholsesale.

    Best of Luck!

    Steve Labus

    214-769-2186

    contactus@dfwrealestatesolutions.com
  • 04 Jul 2012 8:37 AM
    Quote
    Reply # 995362 on 940056
    Bret Allen
    Send me a direct email -- I am an attorney that handles the probate default work for several banks.  I can't give you inventory from my clients but I can explain how the probate code works with real property when the owner dies i.e., working with heirs, identifying administrators, etc.

    Bret Allen
    Attorney
  • 05 Jul 2012 12:22 AM
    Quote
    Reply # 996261 on 940056
    Robin Carriger (Administrator)

    Here's another perspective for you, Sean.  If it will really take $50K - $60K just to make it liveable, that's a HUGE repair/update ticket that will need to be balanced by a HUGE upside potential.  Some rehabbers may be willing to tackle it, but it may be very difficult for you to profitably wholesale it unless the profit opportunity is significant.  Depending on the rest of the numbers, your time may be better spent birddogging it to the right person and moving on rather than spending a lot of time on a long shot.

    Having said all that, if you choose to pursue it, it could be very educational if not profitable for you which could serve you very well on future opportunities.

    BTW, if the profit potential is significant, please give me a call.  I have cash and can close quickly.

    Robin

    Last modified: 05 Jul 2012 12:24 AM | Robin Carriger (Administrator)
Powered by Wild Apricot Membership Software