Help w/short sale w/Provident or Nat'l City Mtg - Posted by Dianna in Seattle

Posted by TKP, Houston on December 16, 2002 at 24:08:35:

Dianna, I suggest you stop in at the bankruptcy court and get a copy of the filing. If it is as you say and the debtor wants to “get out of the house” his filing might show that he plans to walk on his note by conveying the property to the noteholder. If so the bankruptcy judge will probably lift the automatic stay if asked. Of course, you do not ask for that till you have made a deal with the lender. Good luck! TKP, Houston

Help w/short sale w/Provident or Nat’l City Mtg - Posted by Dianna in Seattle

Posted by Dianna in Seattle on December 14, 2002 at 22:45:16:

I’m getting ready to prepare a short sale. Here’s the scoop, the owner has a $250K mtg with $20K in arrears. It’s been listed by a realtor w/comments like “let’s work a short sale.” Well, it has officially hit my foreclosure list AND the owner filed BK. We have several motivated parties here (however, I haven’t chatted w/lender yet)The owner wants out. Per the RE Agent, the bank doesn’t want to wait out this BK.

The loan is an HIGH (11-18%) ARM. Since it’s most likely a subprime product, there’s no MI insurance cushion for the lender, right? So, where/what do I start negotiating with? Where’s my wiggle room?

The property has been listed for $279K and $250K for a couple of months (new at $250K at the beginning of DEC.) No offers. It needs cosmetic work of approx. 5K. I would argue that the LP siding could be a big “neg. factor” for my side.

Ultimately, I want it for about 75% LTV. FMV = $230-$245K. The house is in a great area and I could L/O it easily (I think)…

Any ideas on negotiating points with the bank? We don’t need to get a loan and could do cash offer, but that hasn’t worked to our benefit in the past. Either a bank wants to deal, or they don’t. I want to start figuring out how to make them “want to deal.”

Dianna in Seattle

Short Sale vs. Discounted Note & Mtg. - Posted by JT-IN

Posted by JT-IN on December 15, 2002 at 11:58:41:


You say that the owner has filed for BK… so the effort to work out a short sale is on hold until the BK Trustee grants relief to the Creditor (Prov or Nat’l City), to pursue their remedy… foreclosure.

With that said, the BK does not preclude them from negotiating with a third party, such as yourself, to acquire the note and mtg… at a discount, or course. Should you acquire the note & mtg, then you will be limited by the same constraints of he BK filing, and unable to attempt to collect the debt until the Trustee grants relief from the stay of BK.

What you should do is to contact the Atty handling the foreclosure, and ask them for the contact person and number, in Loss Mitigation of the appropriate lender. When you contact them, tell them you are interested in purchasing the note & Mtg for such debtor… then make an offer to the appropriate person able to make a decision. A simple assignment of Mtg will due the trick, along with certified funds for the amount agreed upon.

Just the way that I view things…


PS. If it is Provident that you are dealing with, and you need contact names and numbers, I could come up with those for you, upon request. Good luck.