Posted by Russ on May 14, 2009 at 11:40:42:
You mean the seller would then foreclose on the person in the house? At this point they’d probably treat it like a deadbeat renter and have to evict them. The bank loan probably prohibits this sort of thing though.
Seller Financing - Foreclosure Question - Posted by Horhay Gomez
Posted by Horhay Gomez on May 05, 2009 at 12:19:32:
I’m still trying to wrap my head around how foreclosure works with seller financing.
Say the seller’s house is worth $160k and they owe $170k on their underlying loan. To move, they’ve seller financed a note (a wrap) to their buyer for $175k.
Obviously the seller’s underlying mortgage is in first position, so if the seller forecloses on the deadbeat buyer, is he not technically foreclosing on himself, since the proceeds from the sale would go towards his bank lien in first position?