This is a very valid proposition.
I ran this by my attorney weeks ago and here is what
i have concluded.
a) If you lend money, you need to be licensed by the
banking commission and will have to follow rules.
Not an easy one.
b) You cannot even place ads in the newspaper with
such verbage that you will lend money.
c) If you add a keyword called “penalty” etc for the
homeowner to redeem, the judge will not like it, should
it go to trial.
d) The best way to work around this is to structure it as
follows.
Offer the homeowner to sign an options contract for
the amount he owes the bank. In the options contract,
you can state that no new liens can be placed, or you
exercise.
If they want to cancel the options contract, they pay
you a fees of $X + the face value of the option.
The $X + x can be a voluntary lien against the house that
you register.
This will work around the banking commission requirement.
Also add a clause that if there is another default, you will
exercise the option.
Request for a notice on any activity on the property with
the county registrars office.
Again, i aint’ an attorney. So check with your attorney
before you make the move.
Good luck
-Krish