What kind of options we can give to people in foreclosures.

Hi, I’am a beginner to this real estate investing world. I am right now helping someone out with there foreclosures. I’m wondering if there is other options for them. Right now she is 4 months behind in her mortages. She got a letter stating her house will be in foreclosure on November 17, 06. Doesn’t that mean it will now be bank owned?She tells me, she dont want to lose her house. She has invested alot in this property to lose it. I want to give her some options in what she can do, then to just leave her high and dry.


Try to get into more detail… equity? no equity? What are the numbers on this deal?

there are options

It all depends on what your person wants for a end result and then you go looking for your fix !!!

Her home will not be banked owned until it goes all the way through the foreclosure process and sells at auction back to the bank.

Being new to this, I’m still tring to find my way around this web site and how to work it.

Anyways,Thank you for the replies.
she is 4 months delinquent, (behind at $4,417.28)
Purchase at $110,000.00
Value of House. $180,000.00
At this point all she can think about is saving her house. And I think
she is really depending on me to help her.
I don’t think she has a plan if all fails on my end.

Typical options to HO:

  1. Refinance - she can try this option before it gets offical notice at the county courthaouse in Nov.
  2. Forbearance - does she have the ability to make more than the standard mortgage payments. ex if she is 10 months behindand owes 5k, they may add 500 extra to the next 10 months. BUT they need to make the payments by the 1st of the month, not the 15th.
  3. Talk to family/friends to help bring payments current
  4. Sell thru realtor
  5. Short Sale
  6. Subject 2


Much Mahalo, Thats, “Thank You very much” for the reply and all the Options. I will comment later on the out come.


I think i can ask this on here and not have to post a new question. But what is a subject 2?

There is an “Investing Glossary” in the left column under “Investor Information”…

Subject To - buyer takes title to mortgaged real property but is not personally liable for the payment of the amount due, buyer must make payments in order to keep the property.

Basically, the buyer takes over payments (but does not assume the loan) “subject to” the conditions of the loan.


where is the property located?

With this much equity theres a good chance the bank would be willing to tack on those back payments onto the end of the loan. Of course, that wouldn’t make you much, but, from what I’ve seen a lot of people that get into this situation once, will again. I typically offer free help with getting forebearance(repayment plans) agreements setup, because a lot of times they will be right back in that situation again. Besides, when a seller is not motivated to sell they become a chore to work with.


Well since yesterday, She hasn’t been easy to get a hold of. I think she has a faxs as part of the same home number. After so much rings the fax comes on.

So I still need to talk to her to see what her next step would be. This place is located on the west side of Oahu. (Nanakuli)

Heyyy I’ll sub-2 it and give the seller and you some money :slight_smile: Good interest rate? A nice vacation house there would be nice!!! Haha


Yeah, That would be a good ideal but I also live on the west side of Oahu and yes it is beautiful. But not intrested to subject 2 it. And now I think I’m confuse about Subject-2. How can the both of us make little money? And I don’t know if I was aloud to mention where I reside on the web.

Sub-2 anyone could make money however. I was being sarcastic, but say I was serious. I could sub-2 or get the house sub-2 the existing $110k financing and give you $5k for finding it for me and $5k to the seller for giving up the home. Of course this $10k would be out of pocket, but better than $120k out of pocket.


Okay! She decided to go with short sale after all her options. The intresting part of this house that she is losing is on the South side of Oahu and it’s a Town Home. The Lender is out of state. It’s in Nabraska. Now, knowing all of this can I still do this, In this short of time being that I still have to find an investor whos intrested in buying this kind of property? Another intresting part about this is, she bought this place at a foreclosure aution for 50k and refinance it in Feb 06. at 50k more. That is where I thought she Purchase this property at 110k. What to do???


Now this also bring me to having more question about other things.
So does this mean to post again and now it’s a different subject?

This is just a flat wholesale, no short sale. You are not negotiating down the payoff as the $110k is low enough for you to find a buyer at a higher price to sell to.

Short selling would be if she owed $180k on a house worth $170k and you needed to get the bank to take less.


Thank you everyone for all the replys:
This is a awsome wed site.
Thank You steve for all the options.
Thank you chase for the knowledge to teach.
This made me knowing more then I started with. And I have more to learn on the next process.
Thanks again for all the replies.


Why short sale or subject-2, when the homeowner does not want to lose the house. I read about foreclosure bail-outs that work like this:

In a simultaneous transaction, the homeowner quit-claims the property to you; and then you “sell” it back to her at full market value using owner financing. So, you are holding a note for $180,000 that she owes you. She still owes $110,000 on the original mortgage. That leaves $70,000 (potential) dollars to work with. (Because you are going to sell the note immediately-- SIMULTANEOUSLY)

With this being a simultaneous closing, you would already have a note buyer lined up, the note buyer would have already looked over the numbers and quoted you a discounted value for the note. Suppose the note buyer is willing to give you $150,000 for the note-- that leaves $40,000 for you and the homeowner to split after the $110,000 mortgage is paid off.

If you take a modest fee (no equity stripping), you could really help this person out a lot. When you draw up the owner financed note, you could make sure that the payment terms are more affordable for her-- while making a saleable note at the same time.

You could help her keep her home and lower her monthly payment to an amount that she can afford.