Vendor Payback

[markj]

I have a property I am interested in that was partly burnt out due to internal fire. There is an insurance payout of around 20,000 for repairs.

Can I make a settlement on the property (lets say it's worth $200,000) and get the vendor to payback to me on settlement the 20,000 from insurance and an additional 20,000 for work that I deem needs doing to finish the property?

That would mean settlement price of 200K paid to vendor on settlement and vendor pays me 40K on settlement.

 

[Qlds007]

You can do anything as long as it is clearly legally documentated in the purchase contract.

If you intend to borrow any money secured against the property you may have an issue with financing a place that is effected by fire damage or requires $20K of repairs on it.

Do you know the insurance claim will be settled. Has it already been assessed and approved ?

Why not get the vendor to undertake both the work and the insurance claim and then buy the property completed.

 

[markj]

You can do anything as long as it is clearly legally documentated in the purchase contract.

If you intend to borrow any money secured against the property you may have an issue with financing a place that is effected by fire damage or requires $20K of repairs on it.

Do you know the insurance claim will be settled. Has it already been assessed and approved ?

Why not get the vendor to undertake both the work and the insurance claim and then buy the property completed.

Thanks QLDs007

I have posted this in the general section

Yes the insurance has been approved. The property is actually a lot higher in price than the 200k and is above 3 mil. I believe market value (in the current condition) that I have based on rental return is around the price or above that I will have in the contract. Although through negotiations I believe and can get 15% of the market price. Rather than have that as the property purchase price I would like to retain this as cash flow to cover some risk.

Any thoughts you have on alternative strategies would be great.