Does anyone know if it is possible for me to offer seller financing in a pre-foreclosure situation?
I have negotiated a price with the person going through foreclosure and, because of all of the new lending guidelines, am afraid that less people will be able to qualify for a loan. Can I still offer seller financing since I “technically” am not holding the note?
Thanks for your help.
Please let me know if you need any clarification.
:cool hey anything is possible it is all in how you put it in place (ie )words and money !!! like a contract for deed type deal where you basicly make the mortage payments and your down is the back payments ?? OR you work out some other type of deal just as long as the main mortage is covered anything is a do words and money !!!
THEN if you want to sell to some one else the same would apply your note with the first person ( seller to you ) would have to be paid off or at the least covered or like a house of cards you all fall down and you would be in the middle holding two empty bags
I have personaly done a lot of deals this way or some form there of and have only been 1/2 burnt once but had alegal way out and had to sue the jerk who screwed me
hope this helps a bit
If I am able to do seller financing in this scenario, if I have enough of a spread, would I be able to sell the note to someone who purchases notes at a discount?
There is always a market for notes if the price is right.
:cool yes you could but keep in mind this there will be a discount and how old or new the note will in most cases make the discount !! MAKE sure all things are covered and then see what falls out this would be your money and sometimes it is not much but better than a zero !!!SOMETIMES note discounts are and have a lot to do with the buyers fico score as well so keep this in mind as well >>> a note sale could take up to 30 days to get complet. THIS in and of it self could be a problemin pre-foreclosures !!! HOW much time you have with one is mostly set by how soon the owner comes to see the foreclosure fixer is not comming and they need to do something >>>>> sometimes this leaves you with little or no time
So how would I go about doing it? Put it in a trust? Do I sign an option with the seller then a seller financing contract with the buyer? I know there has to be a way to make this work but I just don’t know the proper wording to put in the contracts.
Here’s my assumption:
You’ve found a pre-foreclosure and negotiated a price with the seller.
You’ve found a buyer and negotiated a price with them, but they can’t get a mortgage.
So want to buy the house, and seller finance it to the buyer, then sell the note before you have to make any payments.
But if their FICO’s so low they can’t get a mortgage, you’re going to have to take a whacking discount when you sell the note.
So here’s a better plan:-
Buy the house subject to the original mortgage.
Your buyer makes a down payment at least equal to the catch up amount on that mortgage to bring it current.
They then make payments to you at least equal to the original mortgage, you pay the original mortgage, and keep the change. Positive cash flow.
You take a second position lien on the house, and if your buyer defaults, you foreclose and evict them, and make payments until you find a new buyer.
You need to do some good math to make sure you don’t lose out.
:cool by joe i think he has it back side covered and all happy :beer
Maybe I should ask for $2K consultant’s fee.
JDS- The check’s in the mail. haha :lol
:cool hey jds very good i give out advice and give the first one free and after that they have to pay for my help in some way
so iam sorry the check will not be in the mail tell the next one
A favor’s only worth something until it’s done.