Trying to help a friend out. Here’s the situation if anybody can advise;
Property in question is a 3br 2ba condo in s.cal which is currently a rental. Property owners can no longer afford the monthly payments and want out of the situation (but have not yet gone into default). The (now ex-husband) filed a medical bankruptcy a year ago also.
Can anybody advise as to what to do with this situation, and in this market?
Many thanks
I am far from the expert, but I do know, just like with any other type of investment (i.e. stocks), there is money to be made regardless of the market. The strategy should ultimately differ depending on the market conditions.
Having said that, I think that there is a deal. Without any specifics (how much owed, any leins, how much behind, how much repairs will cost, what the property will sell for), it’s hard to say what would be the right approach.
Hi, thanks for your response.
Here goes; They are NOT behind on payments yet. They are renting the property but doesn’t cover anywhere near their out of pocket each month. They bought it for $392,000, owe about $384,000 and they probably couldn;t sell it for anything more than $350,000. Condos are not selling here in S.Cal, so that’s the situation.
Saninv,
I don’t know how badly condos market is hurting in S. Cal, but I don’t see the reason why you cannot buy it for $270K or so. Of course, you would have to short sell it and deal directly with the bank.
What’s your exit? In this market many are leaning to holding and since this is already a rental makes it even easier. If you’re not keen on holding and decide to flip it, then just make sure you get in at a low enough price to support required repairs and costs associated with a regular sale afterwards.
Hope this helps!
How long ago was it bought Short sell the second, if they have one[url][/url]
I am in Southern California. They can’t do a short sale until they miss a couple of payments. The lender would want to work out some type of payment plan before they would consider a short sale.
What are the rental comps and what are the monthly mortgage payments? Bill Gaten, who sometimes visits this forum, has a great solution called a PACT Trust that can be an option here. Basically the owner will place the property into a trust and the renter/buyer will cover the monthly payments. However, to make it work, the rental comps and the mortgage payments cannot be that great apart.
Contact me offline and I can visit them and see what their options might be.
Regards