Posted by Brenda Whittaker on May 04, 2004 at 10:54:52:
Thank you Randy. By short sale do you mean get the lender to discount? Is it likely they will or is it rare? With what he owes on the first, the second, the back payments, foreclosure costs, and my expenses in repair and resell, it would be close so it looks like it can only be done if these lenders or at least one of them takes a discounted payoff. And yes, the market really is as hot as I said. Would you do a subject to on this? Thanks also for the docs. BW
Gotta move on this, what should I do? - Posted by Brenda Whittaker
Posted by Brenda Whittaker on May 03, 2004 at 23:13:38:
I began sending letters to pre-foreclosure owners, not expecting much. Today I get 2 calls from the 2 I sent out a few days ago. The market here is so hot, property is selling faster than agents can list them, and prices are skyrocketing. One caller has a house that comps at $130,000 low end, with minor work. His first is foreclosing on him, $80,000. He’s got a second that was $35,000 in 1999. He’s just going to let the bank take the house, he doesn’t care if he gets anything out of it, but to save his credit would be nice (his words).
I know this is not 65% of the value, however, if there is 10k or 20k potential here, “good nuf”? How would anyone approach this? A lender probably would not rewrite a loan for me. SO, subject to? Try to get the bank to discount? Look for private funding? Lease option? Payments might be too high to lease option, he’s calling me tomorrow with more definate details. Once this house goes to auction, it will be grabbed up fast. I gotta move on it now, if it’s a deal.
Ideas? I haven’t done a subject to or option, or have I ever found private money. My only experience is in buying reo’s to rehab, but reo’s are scarce here now, and they all list top market value, and they get it. Here’s a guy who wants to work with me, and I have a potential 10k reasonably, probably quickly, after costs, in profit. Thanks in advance! Brenda
A Few Possibilities - Posted by MNChicago
Posted by MNChicago on May 04, 2004 at 14:38:49:
I would get a QCD from the owner, give some
nominal consideration. Make a verbal promise
to pay him something for his cooperation…
if you want. (Win-win)
Call the 2nd and remind them that the property
is going for sale (although you did not say how
far away any sale is, or how far along the FC
process is), and they are going to get wiped out
at the sale.
Would they be interested in selling their lien?
If the 2nd mortgage is from 1999, they might
be inclined to believe they are fully protected
via price appreciation since then, and not want
to cooperate.
Only way to find out is to ask. (Deal with their
loss-mitigation dept).
If… (if a frog had wings, it would fly)…If the
property is worth what you say, if the 2nd will
discount, then you know what your potential
costs are.
If the spread is sufficient, go find yourself
some money and make the deal happen.
Best of luck in getting it done.
Re: Gotta move on this, what should I do? - Posted by Randy (SD)
Posted by Randy (SD) on May 04, 2004 at 09:22:54:
“Get it under contract”…
If the market is as hot as you have indicated your first step is always get it under contract, you can always include some creative escape causes but if the seller is motivated-buy it. At 65% ARV an offer of $84,500 minus anticipated repairs, holding and resale costs and profit then consider working a short sale with the second lienholder.