Buying Notes From Lending Instutions--owner's Statement Of Consent???!
Hi everybody!
I'm new on this forum. I was hoping someone had a really slick blanket answer for this question.
I've been approaching banks to buy second trusts deeds where the property is in foreclosure, and about 50% of the loss mit people tell me that I need a statement of consent from the owner. I tell them, "I don't want the property, I want the note." They say, it doesn't matter. Am I doing something wrong? Is there some strange code I should know about? I don't mind talking to the owner, but on so many potential accounts, it just seems like a huge mismanagement of time when I don't even know if the bank will accept.
Is there some code word, like, "Touboucaine?"
Thanks so much in advance for any helpful hints. I'm in CA, by the way.
Hi Amanda,
I had to get similar written authorization from the owner on a foreclosure I purchased. They needed this for them to even talk to me about any information concerning the loan. I am sure they are concerned about a liability issue or there is law that forbids them from disclosing.
In my case I was trying to get info in order to stop the foreclosure so we could close. I did take a run at trying to purchase the second or pay it off at a discount. This failed because there was substantial equity behind both notes.
I hope this is of help.
Regards and good luck.
Ed
Dear Amanda,
I live in the slum just to the East of you and my approach to buying seconds on properties in foreclosure rests on examination into how it was created, for what purpose and of course the present needs and requirements of the lenders.
Is the property on which you attempt to buy the second in foreclosure from the second or from the underlying first? Does the bank or lender whom you approached hold position as named Beneficiary on both notes and trust deeds.?
My assumption is that to achieve a discount on purchase you are dealing in primarily PMTD's taken back by prior owners whose only wish is never to hear from the new Buyers again. That approach is different.
To buy secondary paper from a lender who holds first and second is almost impossible. If they are foreclosing from the first the second gives them overage protection at sale. Also if they are just a little bit strange and clever, they can bid the second at that sale and prevent the property being stolen out from under them on a slightly over opening bid. You have to give it a little thought.
If I were you I would limit my activities to buying discount paper from prior owners PMTD's , much more fun and the discounts can be astounding.
Also, now don't tell anyone. Sometimes Real Estate Brokers have to take part of their commissions in the form of seconds or even thirds. They having a high high overhead, observe the BMW's and Mercedes they drive, will discount pretty heavy especialy around the first of the month when all those payments have to be made and all those bar bills are due....
Cheers, Lucius
Thank you both so much for your generous advice. It will be very helpful.
Gosh, real estate agents, huh? I never knew that. Live and learn.
I'll let you know as well if I do have a successful purchase from a bank. Because it's the chase. The chase that excites me.
Warm Regards,
Amanda G