I live in a rural area in north central Missouri. The typical town here is about 6,000 to 15,000 people, and they’re all about 15 to 20 miles apart. Each town seems to have it’s own little newspaper. I put a black-bordered display ad in about six of those little papers that says: “I’ll buy your house,” and I just let them run continuously. I get a few calls every week.
In mid-August, I got a call from a lady who said she was ready to move to the southern part of the state, and her daughter and son would be at her house the following weekend with a rental truck to move her.
She told me that she had a 850 sq. ft. 2-bedroom house on four lots, fully fenced, and that it was free and clear. I asked what she wanted for it, and she said, “$3,500.” That sounded awful low, even for our area, so I drove the 13 miles to go see it. After going through the house and the yard (big piece of land!) and visiting a bit, I told her I had a lot on my plate, but that I would see what I could do. It didn’t look to me like the house needed anything done to it.
I left, went to a nearby park and wrote up an offer for $2,750 with a $500 earnest money check to show her I was a serious buyer. I called from my cell phone to tell her I wanted to bring her an offer, and she said to come on over. She read it and signed it. I went into town and opened escrow with a title company. We closed a week later.
I didn’t do anything to the house except have the grass cut once and switched the electricity and water into my name. I started running an ad offering to sell the home for 10% down and low monthly payments.
I just closed it for a sale price of $15,000 with 5% down and monthly payments of $263.99 at 10% annual interest. The buyer is a lady who has a 15-year-old boy at home and has rented all her life. I’ve just sold the note discounted for $12,450. Frankly, I have not bothered to figure the return. It is “good enough.”