Posted by cw on September 20, 2001 at 07:00:47:
Yes, I can get owner to quit claim to me without him getting any $$, however, I would need to finance 85% LTV to pay off 1st. What kind of seasoning issues does this create, if any? The original sale was Dec. '00.
Foreclosure on seller 2cnd - Posted by CW
Posted by CW on September 18, 2001 at 23:44:35:
I currently hold a seller 2cnd for a legal “flipped” property in Nov '00 in MI for $32k, Seller has defaulted on 1st(to bank) and 2cnd(to me). What are my options? What is the foreclosure procedure or the best way for me to regain ownership in order to protect my position?
Re: Foreclosure on seller 2cnd - Posted by JoeS
Posted by JoeS on September 20, 2001 at 06:39:40:
How far along is the foreclosure? If the bank still holds the note, try to negotiate with them for a pay down. Then get the deed from the seller. BUT, when a seller has to default on their mortgage, usually they have a string of judgements attached to the property too! A title search will reveal these, and a cost to you is involved. A foreclosure will NOT necessarily wipe these out, although a BK by the seller will, except for IRS and higher education loans. You have a lot to check out, but it may be worth your while. HTH.
Re: Foreclosure on seller 2cnd - Posted by Ronald * Starr
Posted by Ronald * Starr on September 19, 2001 at 20:03:14:
CW-------------
I agree with Angel Gutierrez, talk to the owner if you can. If necessary, pay some “move-out” money to help him/her/it move away after deeding back to you.
If the property owner won’t deed to you, you might try to get some third party to approach him/her/it about buying the property. Just in case the owner will sell to somebody other than you.
If the property owner is uncooperative, you might want to immediately start your own foreclosure. There is almost surely not enough equity above your loan for anybody else to bid at the foreclosure sale. When you get the property, you could pay the senior and then do what you want with the property, resell or hold for rental income. At least, I hope that is the way it works in MI. You could also bring the senior current, to reduce the fees and expenses. In CA, and I assume in MI, the junior lienholder has the right to protect his/her position by bringing the senior loan current and then demading repayment of the “advance” from the property owner. If the property owner does not reinburse the junior lender, the junior can initiate a foreclosure on the junior loan. Since you are not being paid, you don’t have to wait to pay the senior. demand replayment and then start your foreclosure, you can start right away on the basis of the non-payment of your loan.
Still another approach would be to sell your note out at a discount and let somebody else deal with it.
Another option would be to do nothing, hoping the owner will be able to reinstate the first and resume payments on your second. If nothing happens, you could go to the foreclosure sale of the first and buy the property or at least bid it up until there was enough over the first to give you what you wanted. Again, assuming it works in MI like in CA. Here, the money left over from a foreclosure auction goes first to the junior lienholder(s) and anything left over after that goes to the former property owner.
This assumes you have the money to bid at the sale. If you do not, you probably would be well advised to not use this approach.
Good Investing and Good Foreclosing**************Ron Starr**********
Re: Foreclosure on seller 2cnd - Posted by Angel Gutierrez
Posted by Angel Gutierrez on September 19, 2001 at 16:53:09:
Time to sit down and talk with the homeowner. Tell him to leave and take over the first and resell the house. That’s it.
Do this before the first lienholder wipes you out.
Angel
Dallas, Tx