What can be done?

There is a property that I found that is a pre-foreclosure status. The home was taken from the owners because of a lien. They then sat on the mortgage. They owe 116k on the mortgage and the lien is 77k.

The house has a market value in the 300s for the area and schools.

What can be done? My credit is garbage for right now, so going for a traditional loan is not an option for me.

Thanks in advance.

What do you want to do? Is this for investment or primary residence for you?

I would like it to be my primary residence, but depending on what is more feasible, I could use it as an investment property.

I am trying to understand something from your info. Who owns the home right now?? You state there is a lien for 77K and a mortgage for $116K bring the total owed on the home $193K which means 100K equity if your comps are correct. (How did you get your comps also)

You say they sat on mortgage, what exactly do you means…

Reason I ask is, if there was a lien filed for 77K, the lien holder can not collect as it is 2nd postion (unless there are 2 mortgages) and they would need to foreclose on the home to collect which will be tough and risky still as the first will need to get paid off and chances are if the 1st is being paid, they wont agree to a short sale on the 1st.

So lets just say this home is in foreclosure and the 2nd wants to get paid as well. You have crappy credit but you have cash in the bank (NO ONE SHOULD BUY A HOME UNLESS THEY HAVE 6 MONTHS RESERVES FOR ALL BILLS IN BANK). You can look into bring the 1st current and working on a payment plan with the 2nd lien holder. Maybe do a 3 year lease option which will give you some time to fix your credit. Make sure your payment history is recorded to show you payon time, very important and then buy the home. If things have not changed so much, (I am not a mortgage broker) when you go to take title thru a mortgage in your name, it would be considered a refi, not a purchase so it should be easier to get as the bank will consider the equity built in.

You will need to put some money down, depending on the 1st, they may want all the arrears caught up. You can always call and see. They maybe willing to deal. I just recently help completed a transaction where the seller was in preforeclosure and the bank buyer had bad credit due to medical issues. The bank agreed to 75% down payment of the arrears and reduced the loan payments from $2100 a month to $1640 a month for 36 months and no interest will be accrued for that period as well plus the rate was lowered from 7.5% to 5.5% when the loan modifies again. Basically the deal they set forth with the current owner was put into play but with the lessee. Was a great deal…

The previous owners of the house who are carrying the mortgage state they didn’t know they were responsible for the mortgage after the lien holder took possession of the house. So they have not paid the mortgage in almost 9 months.

I got the market value of the house based on the area, the schools, and what similar houses in the area have sold for in the recent months.

Can I go directly to the bank and speak to them about the house and then deal with the holder of the 2nd lien seprately?