I am attempting to take over a first mortgage via SUB-2 and short a 2nd mortgage. The 1st is Countrywide/BoA and the 2nd is Wachovia. I am at a loss as to how to fill out the HUD-1. The 1st is owed approximately $24,000, while the 2nd is due $30,000. The house is worth $42,000. I am willing to pay Wachovia $6,000, but will start at $1,000.
I do not know how to fill out the HUD-1. I am not contacting the 1st, just taking that loan over and re-financing it at the beginning of next year. The 2nd, I am shorting, so I know what to put on the HUD for them. How do I fill out the HUD and is there anything special I need to know in this type of scenario?
P.S. The owner is planning on just walking away from the property, so he has told me I can do whatever I want, as far as purchasing it. I figure if I can SUB-2 the first, then short the second, my out of pocket at close would be under $7,000 for a house worth $42,000.
The owner has also told me he will accept a deficiency judgment. If he receives it, he will file bankruptcy to get it off his record, so I only need to get the Release Of Lien, although I will attempt to get a Waiver of Deficiency, also.