Re: selling part of a property in foreclosure - Posted by JT - IN
Posted by JT - IN on July 09, 2001 at 07:55:51:
Getting comps and determining FMV is one thing, but do not overlook something here. The lender must give a “partial release” of this parcel of land, from the mortgage that is securing this property to the lender. This will effect the loan to value ratio of this loan, and the lender will most likely want considerably more than the $ 22k to do this release, especially since this borrower is in default now. Look at this logically, as if you are the lender, would you give up some of your security, if your borrower is already on the ropes? Didn’t think so.
Now what you are wanting to do is going to be entirely possible, but not by just sending the lender $ 22K, to make up back payments. They will want the “lions share” of what the owner sells the property to you for, and the owner may not want to go along with those terms, as he will be seeing this as a way to get his hands on some dough, and it may not work that way.
Best to understand this feature up front, and educate the seller about this now, and if this is a deal killer, then let it die a rapid death, before you invest lots of time in this thing, only to find this out down the road.
The comps are the easy part of this deal. Shop around and find out what similar lots have been selling for; not just what they are “for sale” for. Big difference! Good luck…
JT - IN