Real Case Studies of Homeowners We Have Assisted
We help distressed real estate owners that need to unlock equity through their property or need to stop auction and foreclosure proceedings. We provide them with a unique solution and the tools to rebuild their financial standing, allowing them to turn their lives around and make sure they are making informed decisions. With our knowledge and experiences, they are able to navigate through this difficult time so that they can get out on the other side fully recovered to ensure your property and family are safeguarded.
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Don’t let debt destroy you or your family. We can help distressed homeowners get back on their feet. We have a proven track record of helping people in financial distress. You too can recover from debt.
A typical example of how the real estate assist team can help homeowners
The examples we illustrate here are real case studies of how Real Estate Assist helped distressed real estate owners
Homeowner’s status in 2019
R 1 650 000
Real Estate Market Value
- Current Bond R 510 000
- Maintenance R 79 000
- Arear Rates & Taxes R 59 000
- Short term debt R 550 000
- Monthly Expenses R87 000 pm
- Monthly Net Income is R 56 800 pm
- Net Shortfall R 30 200
R 531 000
Net Equity
- Net income – R 30 200
- Standing to lose their Property,
- Proceeds and breakdown of family structure and social fabric
- Selling under duress
Homeowner’s status 2021
R 1 915 000
Market Value (5% p.a. + Maint)
- Investors purchase @ R 1 100 000
- Mortgage Increased Bond R 1 280 000
- Settle all short-term unsecured debt
- Increase Credit Score
- Monthly Expenses R 12 000 pm
- Monthly Income R 56 800 pm (no increase)
- Real Estate Improved – better security
- Net Income R 17 900
R 635 000
Net Equity
- Net income R 17 900
- INVESTOR ROI = 18%
- Real Estate Owner able to recover, keep their home, family and social structure in place
Case Study
Valencia Street, Kraainfontein, South Africa
This homeowner has a bond with 38% LTV on their property with their bond payments up to date. The owner’s credit is impaired as a result of short-term debt and use of their credit card as working capital. Due to credit issues, the owner cannot increase the bond. The equity of the property must be accessed without immediate transfer to a third party. Business owner has a growing maintenance business, which requires more tools and vehicles to meet the demand
Assist Group’s Intervention and Solution
- Stop sale in execution procedures
- Make settlement offer to mortgage bondholder for any shortfall
- Sell the property to the investor at 75% of market value
- Sign transfer documentation by the property owner and investor to proceed with the transfer
- Guarantees provided for purchase price payable on the transfer
- Improve property after transfer prior to listing for sale to the third party
- Value Created
- Current Market Value R 1,300,000
- Auction Value @ 60% R 780,000
- Actual Sales Value R 1,300,000
- Equity value saved for owner R 520,000
- Predetermined profit paid to property investor on transfer to third party purchaser
Results
- Sale in execution averted after negotiation with mortgage bondholder
- Property immediately marketed subject to completion of improvements
- Mortgage bondholder accepted offer on settlement
- Acknowledgment of Debt on favorable terms signed with the property owner
- Offer received without renovations that are in the best interest of property owner
- Property owner kept in occupation whilst children finished studies
- The remainder of proceeds from third-party sale paid to the property owner
Value Created |
|
|
Current Market Value |
R 1,300,000 |
|
After Renovation Value |
R 2,400,000 |
|
Equity value saved for owner |
R 0 |
Costs |
|
|
Transaction Costs |
R 71,405 |
|
Renovation Costs |
R 0 |
|
Investor Profit |
R 57,801 |
|
Capital Growth |
R-180,000 |
|
Net costs for the owner |
R -50,794 |
Net equity saved for property owner by intervention R 215,723
Case Study
Frangipani Street, Brackenfell, South Africa
The owner recently got divorced and their previous employment contract was canceled. They had arrears on a mortgage bond, short-term debts, and school fees. They had a bond LTV of 40% on higher-value property that required only cosmetic renovations. The owner secured a temporary employment contract but was still unable to settle their arrears. Sale in execution procedures was then instituted by the mortgage bondholder. They required access to equity in their property as soon as possible to provide a stable environment for their children.
Assist Group’s Intervention and Solution
- Sell the property to the investor at less than market value to stop the sale in execution
- Provide rental agreement and perpetual option linked to a lease to the previous owner
- Utilize proceeds for settlement of debts after transfer and cosmetic renovations
- Should option linked to a lease not be exercised then the property is sold to a third party
- Sale in Execution procedures stopped. Pay predetermined profit to the investor as contractually agreed
- The remainder of proceeds payable to the property owner on transfer to third party purchaser
Results
- Sale in execution averted after-sale to investor
- Debts settled from proceeds after transfer to the investor and school fees paid
- Temporary employment contract not renewed to enable exercise of the option
- Rental agreement and option fees paid for 21 months provided a stable environment for children after divorce
- Property sold to the third party with listing after maintenance to maximize proceeds
- Pre-determined profit paid to investor and remainder of proceeds to the property owner
Value Created |
|
|
Current Markete Value |
R 2,300,00 |
|
Auction Value @ 60% |
R 1,380,000 |
|
Actual Sales Value |
R 2,800,000 |
|
Equity value saved for owner |
R 1,420,000 |
Costs |
|
|
Transaction Costs |
R 281,965 |
|
Renovation Costs |
R 13,563 |
|
Investor Profit |
R 362,454 |
|
Rental Saving |
R 0 |
|
Net costs for the owner |
R 657,982 |
Net equity saved for property owner by intervention R 762,018
Case Study
Homeowners from Kraaifontein, South Africa
The homeowners were married in COP and the husband was responsible for the payment of the bond. The business operated by the husband at the time, unfortunately, was not profitable and the family fell in arrears with the mortgage bond payment. The mortgage holder took judgment with the sale in an execution scheduled within 60 days. The homeowners urgently required time to rehabilitate their credit record and income whilst retaining occupancy of the property.
Assist Group’s Intervention and Solution
- Sell the property to an investor at less than market value
- Provide rental agreement and perpetual option linked to a lease to the previous owner
- Utilize proceeds for settlement of arrear rates after transfer
- Should option linked to a lease not be exercised then the property is sold to a third party
- Stop sale in execution procedures
- Pay predetermined profit to the investor as contractually agreed
- and the remainder of proceeds to the property owner on transfer to third party purchaser.
Results
- Sale in execution averted after the sale to an investor
- Arrear rates settled from proceeds after transfer to the investor
- Rental agreement and option fees paid for the entire period of transaction
- Perpetual option linked to a lease exercised by the owner to purchase the property
- The predetermined purchase price agreed paid and the property transferred from the property investor
Value Created |
|
|
Current Markete Value |
R 700,000 |
|
Auction Value @ 60% |
R 420,000 |
|
Equity value saved for owner |
R 280,000 |
Costs |
|
|
Transaction Costs |
R 104,952 |
|
Renovation Costs |
R 0 |
|
Investor Profit |
R 200,540 |
|
Capital Growth |
R-126,000 |
|
Net costs for the owner |
R 179,492 |
Net cost for the property owner to access the equity in their property due to intervention R 100,508
Case Study
Sonny Leon Street, Matroosfontein, South Africa
The co-owners of the property were married in the community of property but divorced. The couple needs aid in transferring the remaining part of the bond following the divorce settlement, but the bond has fallen behind and the bondholder initiated the sale in execution procedure. The property needed significant renovations to increase market value, while the husband owed significant unpaid child maintenance fees and the children were pulled out of school as a result of it. They had a low LTV bond on top of arrears on their bond and rates that needed to be settled.
Assist Group’s Intervention and Solution
- Enter a Joint Venture agreement with an investor
- Stop all legal actions by mortgage bondholders
- Property investor provides funds to pay debts and renovate the property whilst the property owner provides property and security
- Pay outstanding school fees and return children to school
- Improve property prior to listing it for sale, to achieve the best possible price
- Pay predetermined profit to the investor as contractually agreed
Results
- Improvements to property complete
- Additional proceeds came from improvements
- Ensured peace of mind with the settlement of the co-owners divorce
- School fees were paid and children placed back into school
- Predetermined profit paid to investor as contractually agreed
- Legal action of mortgage bondholder stopped
Value Created |
|
|
Current Market Value |
R 800,000 |
|
Auction Value @ 60% |
R480,000 |
|
Actual Sales Value |
R 990,000 |
|
Equity value saved for owner |
R 510 |
Costs |
|
|
Transaction Costs |
R 56,751 |
|
Renovation Costs |
R 57,365 |
|
Investor Profit |
R 343,778 |
|
Rental Saving |
R -36,000 |
|
Net costs for the owner |
R 388,106 |
Net equity saved for property owner by intervention R 388,106
Case Study
Tamarisk Street, Durbanville, South Africa
A pensioner with two adult sons recently learned he had a medical condition that required full-time nursing care and hospitalization, but his pension was not sufficient to cover all expenses, and his children were unable to keep up with the bills either. As the owner of an unbonded property, he needed short-term access to equity in the property. A number of improvements were needed on the property to maximize proceeds, address arrears, and address shortfalls each month
Assist Group’s Intervention and Solution
- Sell the property to an investor at less than market value
- Utilize proceeds for medical expenses, arrears, and improvements before transfer
- Improve property prior to listing for sale, to achieve the best possible price
- Pay predetermined profit to the investor as contractually agreed
- The remainder of proceeds payable to the property owner on transfer to the third-party purchaser
Results
- Improvements to property completed
- Proceeds for medical expenses paid before the transfer
- Property sold within 6 weeks of listing
- Generated additional proceeds from improvements
- Additional proceeds of sale invested to secure monthly income stopped
Value Created |
|
|
Current Market Value |
R 1,400,000 |
|
After Renovation Value |
R 1,750,000 |
|
Equity value saved for owner |
R 350,000 |
Costs |
|
|
Transaction Costs |
R 172,757 |
|
Renovation Costs |
R 150,000 |
|
Investor Profit |
R 78,694 |
|
Net costs for the owner |
R 401,451 |
Net equity saved for property owner by intervention R 51,451
Case Study
Valencia Street, Kraainfontein, South Africa
This homeowner has a bond with 38% LTV on their property with their bond payments up to date. The owner’s credit is impaired as a result of short-term debt and use of their credit card as working capital. Due to credit issues, the owner cannot increase the bond. The equity of the property must be accessed without immediate transfer to a third party. Business owner has a growing maintenance business, which requires more tools and vehicles to meet the demand
Assist Group’s Intervention and Solution
- Sell the property to an investor at 59% of market value
- Utilize installment sale agreement with pre-agreed conditions
- Delayed transfer to property investor and keep the current bond payments up to date
- Pay predetermined contractually agreed monthly profit to property investor
- Minimize capital outlay for investor during 24-month instalment sale agreement
Results
- Property sold via installment sale and JV agreement with contractually predetermined profits and terms of on-sale
- Equity unlocked with instalment sale deposit with 24mths before transfer and sale
- Income increased over the next 15 months and credit record impairment corrected
- Application completed for a new mortgage bond, subject to cancellation of installment sale agreement with investor approval
- Predetermined profit paid to the property investor with property owner keeping the property and receiving full capital appreciation on the property
Value Created |
|
|
Current Market Value |
R 2,400,000 |
|
After Renovation Value |
R 2,400,000 |
|
Equity value saved for owner |
R 0 |
Costs |
|
|
Transaction Costs |
R 71,405 |
|
Renovation Costs |
R 0 |
|
Investor Profit |
R 57,801 |
|
Capital Growth |
R-180,000 |
|
Net costs for the owner |
R -50,794 |
Net equity saved for property owner by intervention R 50,794
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