I got my first offer on my co-op - home equity question

Well.... i got my first offer on my co-op. A senior citizen couple came to my open house on Sunday and made what I felt was a very fair offer on it (especially since there is no RE commission involved).

They own a house in a neighboring town.... which I think they have full equity on (house is easily worth over 500k most likely).

The ideal scenario for them would be to take a home equity line of credit on their house for the purchase price of my co-op (lets say 279k).

Has anyone gotten a HELOC for this amount of money? Its probably half of what their house is worth. How long did it take once you filled out the HELOC did you get your cash?

If they go this route and get the money... I theoretically have a cash deal which would be nice. So I should be able to close quick with them. I would honestly love to sell the co-op to them.

I just don't want them to tell me I have to wait till they sell their house and they try to schedule a house closing around my co-op closing cause then i'll be waiting for months.

Would you feel more comfortable selling your house to somebody in this situation... or would you rather sell to someone that has to try to get a mortgage (even though they can bring a pre-approval).


I am still going to show the house over the weekend just in case. I have a bunch of realtors bringing buyers. I am also having another open house on Sunday.


Just curious what the masses feel about this. I am going to get advice from my lawyer tomorrow.

Re: I got my first offer on my co-op - home equity question

The best situation would be if someone sold their house already and has cash in hand to by the co-op.

Your scenario is probrably the next best thing since they will "in theory" have cash from a home equity loan. To me, this would be more ideal than someone (or a couple) working on their first mortgage

A pre-approval letter meant squat when I sold my condo - which I did on my own. The first set of buyers had one, but in the end, they coudln't get the loan and wanted to drop the price $20K - yeah right.

Personally, I would hold off on a decision until after this weekend when you show it again. Maybe someone will have the cash to simply buy it. Not only is it important to sell the co-op for it's proper value, you want to it as quickly as smoothly as possible.

Re: I got my first offer on my co-op - home equity question

Well I definitely feel I got good value with the co-op with this offer. I don't think I would get much more (at least FSBO).

They have no problem going into contract right away and dropping down 15% at contract.

They are supposed to get me their lawyer information as soon as they get a call back from him.

So we shall see.

One of the RE agents called me saying one of the buyers made me an offer... which after the RE's commission... was about 20k less.

It gets tricky once you have more than one offer on the table cause you have to start telling people no. Ya know?

I may get more offers over the weekend which will lead to more crazyness.


I was just curious if finding someone that already owns a house would be a safer bet over someone getting their first mortgage.

Re: I got my first offer on my co-op - home equity question

I understand where your coming from.

I would lean towards the buyer who already owns a house over someone getting their first mortgage. I would also lean towards any deal that didn't involved a RE agent. Sounds like you have the best of both worlds.

Re: I got my first offer on my co-op - home equity question

Re: I got my first offer on my co-op - home equity question

Posted by DjPiLL

Posted by dengal

I would also lean towards any deal that didn't involved a RE agent.

Ouch... don't let MrsERod hear that one. Or else she will call you a "know-it-all".

Sorry ERod.

Re: I got my first offer on my co-op - home equity question

That's why I didn't chime into the other thread.

I'm a do it yourself kind of guy when it comes to some things and I really didn't want to get a RE involved when I sold my condo. I did my research and I think I saved a lot of money and it really wasn't much of a hassel - just a $250 ad in Newsday and a few signs on the corner. Sold it in a week. The previous owner did it when I bought it from them, so I knew I could at least give it a try.

Re: I got my first offer on my co-op - home equity question

Posted by dengal

That's why I didn't chime into the other thread.

I'm a do it yourself kind of guy when it comes to some things and I really didn't want to get a RE involved when I sold my condo. I did my research and I think I saved a lot of money and it really wasn't much of a hassel - just a $250 ad in Newsday and a few signs on the corner. Sold it in a week. The previous owner did it when I bought it from them, so I knew I could at least give it a try.

Re: I got my first offer on my co-op - home equity question

I think you have a slight upper-hand over the typical seller because it seems like there's a big market for a co-op like yours. That's how I felt about my condo - if one offer fell through, I knew they would be someone waiting in the wings. I too needed the cash for my new house. My attitude was every penny I can squeeze out of this sale I could use towards the downpayment on the new house - and thus a lower mortgage.

Are you going with the offer you received?

Re: I got my first offer on my co-op - home equity question

I think that getting HELOC will be nothing for these people considering they have full equity in their current home. It usually only take a few weeks to close on a HELOC, it sounds like a good deal... i would also keep showing your co-op until you sign contracts of course.
good luck!

Re: I got my first offer on my co-op - home equity question

To answer your question....for them to get a HELOC could be a matter of days...to a few weeks. When I got my HELOC on my house...I was surprised how quickly it went. I think I applied online on a Tuesday or Wednesday...I was at the bank for the closing on Saturday....and 3 days later the money was available to me. So...it's pretty easy and they shouldn't have a problem taking a HELOC for 279K if their house is worth 500K. Good luck!

Re: I got my first offer on my co-op - home equity question

Sounds like you have a soild offer. I would take the elderly couple seriously and have your lawyers speak asap, especially if there is no RE commission involved. I would continue to show the apt and I would also let them know that you planning on showing until you have a signed contract.
I had a similar situation with my last house and after we got our 1st accepted offer, we got 3 more offers which were better and we told the 1st couple what we had on table if they wanted the house they would have to beat the best offer, which they did. I felt bad about it, but I wasn't going to lose 12k+ because I felt bad. I was also scared that getting greedy was going to bite me in the butt. In the end everything worked out, but it is a gamble either way sometimes.

Good luck! Also are they flexible with the terms such as your closing date? We they allowed you to "rent" back from them if needed, so you can close on your new house. These are also important things to consider.

Re: I got my first offer on my co-op - home equity question

I will see what happens.

This is getting crazy now because one of my RE agents has a buyer for my place.

She has the buyer up to 266k (originally offered 250k). But of course I would have to pay commission on that. But I have a feeling that even though she says she gets 4%... i have a feeling thats negotiable cause this is an open listing. Maybe she will take less commission to take the sale.

The senior couple offered 260k.

I told the RE agent that if she can get her buyer's price high enough where I can net 260k... I have a feeling I might take the offer with the RE agent because it would mean less work for me in the process.

I gotta see. I hate having to make these tough decisions. I like the senior's offer because they made their offer straight up. And we could theoretically close quickly.

But I just have a bad feeling that things will get drawn out with them. They are still waiting to get a call back from their lawyer they left a message for. I dont have their lawyer information yet to send contracts. And they still have to call a bank to get a HELOC.


Hrmmmmgh!

Re: I got my first offer on my co-op - home equity question

about the HELOC...the sellers we bought from did it for the house they were buying. It was so they didn't have any contingencies when making their offer for their new house.

I'm not sure how long it took them, but they were very interested for us to have a quick closing, b/c they were closing on their new place quick

Re: I got my first offer on my co-op - home equity question

Well... I just decided to make a deal with the devil.

I am going to accept the Broker's offer of 267k (offer raised four times from an initial offer of 250k). After the commission... this offer is about 3k less than the senior couple that came in. But it also eliminates a lot of the legwork I have to do. And the agent is supposedly "in with the board"... so that will help move the application through quicker.

The senior couple was moving insanely slow in getting a lawyer and I had a bad feeling about the whole deal with them so I said the hell with it.

Hopefully i'll have a nice smooth and issue-free closing on this. I really need this deal to close because the sellers of the house I am buying want to move very quickly.

I just signed the contracts today for the house... so its time to get seriously cracking on this.

Re: I got my first offer on my co-op - home equity question

Well the RE agent came over and I signed the binder. It was already signed by the buyer. Contracts will be exchanged this week.

I feel like a big load is taken off my shoulders with this! I hope it runs nice and smooth.

Re: I got my first offer on my co-op - home equity question

Hope everything works out smoothly.

Re: I got my first offer on my co-op - home equity question

Congrats Rich, hope both your sell and buy deal goes smoothly!

Re: I got my first offer on my co-op - home equity question

Congrads DJ - I hope the rest of the process goes smoothly.

Re: I got my first offer on my co-op - home equity question

I have taken a home equity for $250k to do something similar. It only took like 3 weeks before I had the money. It was really easy.