I am new and learning, so I have a question about equity purchase. What is it and how can I tie it into the pre-forclosure process.
Howdy Lateef:
I am not sure what you think equity purchase is. I can give you some examples that may help you understand. It is basically jusy buying someone’s house. Maybe some guru has you confused. In a preforeclosure for example you find that they owe $190,000 on the house and the comps in the area are $160,000 in the best of condition. They have no equity to purchase in this deal the best you could do is to offer them a few hundred under the table and try to get the bank to take less before the sale date. This is called a short sale and the bank will not let the homeowner get any of the proceeds.
In another example the same house but the loan is $100,000. Here you may be able to get the property for say $120,000 and give the seller $20,000 for their equity. They may be even or motivated to sell and may take even less depending on the situtation.
Also I have heard it kind of in a slang meaning that I purchaed an equity today meaning they got a good deal and bought lower that market price
Hope this helped a little. Sometimes my answers even confuse folks more. Please ask questions until you understand.