Jun
09

Grand Prize Home is Underwater!!

By

I enjoyed the week in Santa Fe, New Mexico looking at properties and of course shopping in all of those great stores in the plaza.Well, the temperature here in New Mexico is up there and at 7,000 feet I pulled out my big hats to stay out of that hot sun.

Busy week with several homeowners interested to talk about raffling their home that is underwater. I’m not speaking literally, gurgle gurgle, but a home that say appraises for $400,000, but the mortgage is $450,000. This is not the perfect scenario for a grand prize home because the nonprofit (charity) in most cases, will award the homeowner the appraised value, not  the amount of the mortgage. This makes sense since the nonprofit is essentially purchasing the home so why should it pay more than the appraised value for the home.  Think of it this way–you’re looking for a 4 bedroom home to buy,  and you expect that the price of the homes you look at will be based on what other comparable homes have sold for in that same area. You don’t expect the price to be based on the amount of the mortgage. Many people refinance their homes and take out cash increasing the mortgage amount, and many  homes have gone underwater just because the real estate prices have dropped.

So should you forget about raffling off your home if it is underwater? Well, not so fast. There may be a way for you to get more than the appriased value if you offer more value to the nonprofit than the appriased value of the home. For instance–let’s say you are in the advertisng business and you can offer your services to the nonprofit for a fee. The nonprofit runs the raffle, and the principal of the nonprofit might be able to use your services for the promotion of ticket sales, and your fee might help to bridge the gap between the appriased value of your home and the mortgage amount. Be sure you have a spectacular grand prize home because not all homes make for a good grand prize. The nonprofit does not want a grand prize that ticket buyers are not willing to risk their money to win.

To your success!

Diane G. McDermott

Categories : Just the Tips

Comments are closed.

What Others Are Saying:

“The book really does take you through the entire process. I feel like Diane holds your hand from beginning to end from qualifying the grand prize home to what happens after the drawing. I’m a homeowner and I’ve had difficulty selling my beautiful home. Now I know what it takes to sell my home in a raffle. I know exactly what type of nonprofit I need to partner with on my house raffle and what to expect. I’m excited to get started.”

-Karen L. Furguson, Homeowner in Tucson, Arizona

"Consulting with Diane by phone has been invaluable. Her knowledge on the subject of house raffles is enormous, and she has really given us a better understanding of the process as we move forward with our house raffle. She has been more than willing to take the time needed in answering all of our questions. After consulting with Diane, we feel we have a much better chance of putting together a successful house raffle and are excited about making it happen."

Chip Thompson, homeowner in Rehoboth, Delaware

"'I Sold My House in a Raffle' is an excellent example of creative marketing. The best marketers think "out of the box" and Diane shows that you can really sell your house in a raffle!"

-Ali Pervex, International Best Selling Author, 'Get Your Black Belt in Marketing', www.blackbeltinmarketing.com

“What a great marketing tool! This is a hot new method to get a property sold. My clients love this idea—I already have my first raffle house lined up. I’ll use Diane’s process to get and sell more listings.”

Jack C. Rosemary – California Real Estate Broker, 26 years experience

“I attended Diane’s workshop on February 27th, and she’s got it all together. Not only does she know how to pull off a house raffle but you can tell that she was a teacher because she knows how to convey the information. She broke the process into bite-size pieces and gave us exercises to complete so we were involved. Before anyone attempts a house raffle, they should attend Diane’s workshop–there’s more to it than one could imagine.”

-Ron Thomas, Real Estate Investor for 20 years, Albuquerque, New Mexico