I was talking to a guy at work yesterday and discovered that he was in foreclosure. He has not made a payment in a year. The house has been listed on the market for 3 months and is now for sale by owner. He also told me that he just wants to walk away from the house. I told him this is his lucky day and that I could help save him from a foreclosure that would wreck his credit. I told him that he could possibly get some money out of the deal to move with :). Now that I have an opportunity I am wondering if this is a good ss candidate. He says the property is listed at 149k but its worth 160k, I’ll confirm numbers tomorrow when we sit down and talk. This is very exciting for me because I have been reading about this. I even took out Matt’s book and showed him his eight options. BTW the lender is countrywide so any advice would be great. I’ll post as the deal progresses and we can see what happens.
Sounds like you may have something going. Start by looking at real comps in the area. Get a feel for the real value of the property.
Next and most important get an Authorization to Release Information. Send it in to the bank and then find out exactly how much is owed on the property and a payoff. You will them be able to intelligently start to outline a plan of action and decide how you want to proceed. You may also want to do a quick review of the court records in your county to check for other liens and judgments against your customer.
Also you said the property is listed on the MLS. This may present a problem as brokers can sometimes be difficult in the middle of a foreclosure transaction. Let us know how is proceeds.
If he has had it listed at $149K and could not sell it, then it is NOT worth $160K.
It is not even worth $149, or he would have gotten offers on it.
Your first step is to determine what the house would actually sell for, before you start making offers on it. If he couldn’t sell it for $149K, chances are that you can’t sell it for 149K, either. So you are going to have to buy it for a lot less than that.