I have a deal that I’m trying to work. The Homeowner is behind 4 payments. I’m not sure what the best way to accomplish this.
Here are the numbers.
Mortgage Balance: $189,000 (including back payments, attorney fees, interests)
Monthly Payments: $1,200
Taxes and Insurance: I’m not sure about
HOA’s: $600/year
Property worth $300,000
Equity: $111,000
The homeowner like I said above is behind on her payments. The total fees (Back Payments, Attorney Fees, Interest) come out to $5700. The HOA’s have been paid for the year.
The Homeowner wants to stay in the house until June '07 but she said that she could make up the arrears but doesn’t want to. If she really has to then she will. She said that if I make up the back payments, she would be willing to deed the property to me, and supposedly said that she can make the $1200 monthly payments.
She said that she’s open to doing an equity split when I sell the house for her in June '07.
I’m not sure what her hardship is, I will find that out later. Granted, that she can make the payments. How can I work this deal?
I’d be concerned about her ability to make the $1200/month payments if you took over. You need to find out what has changed that will make that possible. That would be a flag for me.
This does not answer your question but a common rule is to not let the homeowner stay. What will you do July 02 when she tells you she wants her house back and is calling your States Attorney General office and tells them you tricked her and she thought it was a loan you were giving her. This is not likely to happen but all over the country states are enacting these ‘mortgage rescue fraud acts’, designed to protect these “poor homeowners”.
Try to convince her to leave before you put any money out.
you can try for a forebearance where the mortgage co puts the back pmnts on the back of the loan, and brings it current. this may raise the pmnts though so consider that. also, get the tax/insurance info to see if it is incl in the pmnt already. i bet is it not.
if the back pmnts are made up, you should do this, not her. under no circumstances should u let a seller stay in the house, rent or no rent for longer than 30 days to pack and get out. even if they have cash or a new job, the fact is that they got behind once, will not own the house anymore, and sometimes just don’t care.
if you can structure a deal, get the deed, do your title search, record the deed, make the pmnts up, and give her a note for her equity share. when the house sells final in the end, she’ll be paid off at the refi, and so will you.