Underwrote 9,500 net on a 38k rural house and took 1,340 out of eleven weeks
Cheap end of a farm town, population under 4,000, no lender involved on either side. Contract at 38k, end buyer a local landlord at 52k. 14k spread on paper and I've done enough of these on the passive side to know fixed costs bite at low price points, so I built in a cushion. Not enough of one.
Where the 14k went:
- transactional funder minimum fee 2,500. My draw was 38k, so that minimum was effectively 6.6 percent, and every funder I called had a floor between 2,000 and 3,000 regardless of size.
- two owner's policies, each hitting the insurer's minimum premium in my state rather than a rate on 38k or 52k. Around 900 combined.
- closer's fee 750 per side, so 1,500. Also a floor, not a percentage.
- transfer stamps on both legs, about 480.
- survey the end buyer insisted on, 650, and I ate it to hold the deal together.
- code enforcement lien I did not find until the funder ordered their own search. 3,900 to release, mowing and board-up citations going back years. My contract had me clearing liens, which I signed without thinking hard about what a vacant rural house accumulates.
- the county here does not record same day, so the funder was out three days instead of one. 450 in extension.
- utilities, insurance binder, wires, courier. Call it 280.
That lands me at 1,340 for eleven weeks of work, two trips out there, and a week where I genuinely thought I'd be closing at a loss.
What I'd do differently: order a real title search before I commit to a funder and before my earnest goes hard, and price the fixed costs as a dollar figure rather than a percentage of the spread. On a 38k purchase the two closings cost me nearly 6k before the lien even showed up.