I like preforeclosures with 2 loans, to be able to short the second one and create more equity, but havent found a solid method to find homes that have 2 loans. Right now I am just relying on luck from people bringing me their pre-foreclosures, that some have 2 loans.
Does anyone have a good method to find out how many loans are on a house/finding pre-foreclosures with multiple loans?
Why don’t you have someone look through the newspapers for everyone that is going through foreclosure. At this point they can look up at city hall to see how many mortgages are on the property and build you a list.
Just remember…
The harder the list is to create the more valuable it is… Good luck in your search…
You can also buy a list of defaulted 2nd mortgages from a list broker…
“Just remember…
The harder the list is to create the more valuable it is…”
haha I definitely agree.
"At this point they can look up at city hall to see how many mortgages are on the property and build you a list. "
This is where I have been struggling, maybe I just need to spend more time there to learn the system, but I havent found a good way to cull through all the preforeclosures that does not take up tons of time
“You can also buy a list of defaulted 2nd mortgages from a list broker…”
Somehow I did not think of this, thats a good, simple idea. Has anyone ever done this before?
pull a NOD list and then take that list to your title company and have them run it for multiple loans… They will do it as long as you have set up a relationship…
Also Foreclosures dot com gives you that info as well
Good luck
Michael
While I agree with you on the 2 mortgage ideas. It really does not matter when you are doing Short Sales and know what you are doing it really does not matter if there is 1 lien or 100. (Just kidding about the 100 most I have ever done is 13 on one property)
Summit, would you expand a little more? I was under the thinking that w the 2 liens its easier to make more equity because the second lien getting knocked out will open up more equity than you could normally negotiate down if it was just one mortgage?
Just by numbers, if you have an 80/20 and you knock off almost all the 20, you have created almost 20% equity
If you have a single mortgage, thought that the biggest discount banks are accepting now is around 15, sometimes up to 18%?
Am I off on this?
There’s no equity in a short sale 
Banks will ultimately accept whatever is in their best interest. “Their” being the optimum word. You have to make the case to the bank that your short sale is the best option for the bank. If it really is, the discount can be MUCH, MUCH greater than 18%.
Think about the short sale offer letter - it compares scenarios (REO Resale - Repaired, REO Resale - As Is, Auction Price) and then shows how the Short Sale Offer is financially the best scenario for he bank to end up in.
It’s ALL about “making the case”. It’s a financial decision for the bank and if there is any ambiguity about the offer you made, it won’t work - and frankly, shouldn’t. The banks don’t want to throw away equity - but will if the risk that they will lose even more is substantial enough!
There are a few problems that you will encounter with short sale on 80/20s.
The second mortgage holder will most often wait until the last moment before auction to deal even when you have the 1st SS approved. This is frustrating and but even more for a end buyer you may have in place or the homeowners willingness to cooperate. The have no incentive to close quickly for $2-3k or 10% when they could possibly get more if the wait it out.
The other BIG issue is if the 2nd mortgage is really large and the 1st mortgage might not accept a short on the first if the actual value (BPO/Appraisal) is close or above their payoff. In this case you could just pay the 1st in full if its that good of a deal B-U-T now the second mortgage will want more $$ and not just the 2-3k or 10% if the first did take a short.