Hello all–This is my first deal. This guy is going into foreclosure in 10 days. Before calling me, he was just going to let his house go into foreclosure, no money to pay
40% equity in the house.
He owes more than he borrowed. I want to go to the table with more ammo than just SS and forebearance. Can anyone suggest anything else you would do?
If he truly has 40% equity in the house… meaning the house is worth 100K, and his mortgage is only 60K, I would have him put the house into your land trust, and see if the bank will allow you to bring his mortgage current, and then follow through on your exit strategy.
Short Sale is for houses that are backwards in equity, this looks like a Sub2 deal to me.
Hello-thank you for your replies.
After doing the Preliminary title search, looks like the 40% equity on the NOD is no more.
There are 2 private lenders
1st 630K
2nd 200K
liens
appraised at 647K in 2006
2nd is foreclosing first
Finally got the payoff notice with fees, etc… comes to $221K
1st has sent out to foreclose too. Haven’t received any payoff information from them yet
My question is… please–All suggestions are welcomed!
Can I short the 2nd to 20K – if the house goes to auction, they won’t get much more than that after they pay off IRS, 1st, etc?
I’m dealing with private lenders and I’ve only read on dealing with the bank’s loss mitigation. Is that the same?
Even if the lender foreclosing is in in second position? Wouldn’t they have to auction over the 1st mortgage to even collect the remaining? Thinking about the 20-30% rule. Sorry–first deal and really confused.
If I needed more time, can I also ask the foreclosing lenders to give me more time and not let the house go to the auction? Thanks much!
Again, since these are private lenders, they may want the house back more than having you do a short sale. Have you gottoen the Letter of Auth to release from the HO to talk to the second? Did you find out if they are interseted in doing the ss? If they arent, then you have no deal
Yes, the 2nd just called me. I’m thinking of how to negotiate or initiate the ss. I will just call back and see what they say. He didnt sound too pleasant on the message. Wish me luck!