Best Friend's forclosure
I have a friend who has a rental property (currently leased) but is 2 months behind on payments (~$2500)and about $8000 behind on taxes. The property is estimated ARV of $93,000. He believe he owes $83,000 + the behind balances. He's thinking about getting out of it. It is a 2/2/2 and a bit outdated on the inside.
He has not received any forclosure letters as of yet, but I feel that they are coming up shortly. He's done this before and the mortgage company has already worked with him by adding the owed balance to the end of his mortgage. I don't know how much leeway he will have with them at this point. His credit is horrible.
Does anyone have any suggestions of what I might be able to do with this or advise him to do?
I would start by seeing if the current tenants would be interested in purchasing the home. They might have good credit and a down payment. Or maybe sell them a option to purchase if they have enough to cover the amount that he is behind and have them sign a new lease that will give him positive cash flow. Keep in mind that i am a newbie, but i would try to work with them first since they have a lease with him. Or go the other way and try to work something out with the bank. Im sure they might want to work with him since theres not much equity. Get creative, something will work out.
Andrew