Could This A Negotiating Tool????
I am currently in the process of buying a duplex (Section 
. Now there are three mortgages on the property:
1st: 240,000
2md: 64,000
3rd: 30,000
TOTAL: 334,000
Property is only worth $275,000
Now I know I can hack away at the second and third, but I want to be able to hack the first too.
My question is...does having renters in the home in foreclosure deter the lender from foreclosing on the home??? Or at least make them more likely to accept a short sale????
Thanks
Having renters does not deter the bank. There is a clause in the mortgage note for an assignment of leases and rents whereby they can collect the rent to put towards the outstanding debt. Use this as a tool with the 1st mortgage company to pay down the outstanding balance. Then negotiate the 2nd & 3rd. Offer to get the owner to do a deed-in-lieu that the bank will allow you to assume. Then you can get title and stay current with them.
Unless your analysis indicates anticipated expenses of $35,000 for the first to foreclose, acquire, hold, and liquidate... they aren't motivated to short.
Concentrate on the first second mortgage. You can probably buy the second second for a few bucks...