Foreclosure Question With Lender In 1st
I'm sure I don't have a possible solution or deal on a property I looked at last night. I'm more looking at it as an opportunity to learn.
Basically home worth 265K. 1st at 209K and 7 months behind @ 10%, payments of 1690. 2nd 48K current @ 10%, payments of 648. Taxes about 150 month.
Fees and missed payments total: 13,500k.
The company in 1st position told the sellers that once they missed one payment that they cannot make anymore payments and owe the full amount. I've talked with the company and they really aren't all that easy to talk too.
They haven't let the 2nd go because the brother of the husband is the primary signer and he works for the pentagon with secret clearance and can't have credit problems without jepordizing his clearance.
I hope that is enough for some seasoned investors to maybe give me some possible solutions or ideas on what could possibly make it a deal. Also is it common for a mortgage in the 1st position to not deal with seller or with me at all when they are fairly leveraged?
Not knowing how your forclosure process works, I would say get to a Real Estate Atty ASAP.
[ Edited by pmatheson1 on Date 07/18/2003 ]
Hi,
What state is this property located in? What company owns the 1st mortgage? Is first mortgage FHA or VA?
We may be able to provide help and advice if you would reveal more information.
Regards,
Dmitry.[ Edited by Dmitry on Date 07/18/2003 ]
Thank you both for your replies. Property is in MN. The company the 1st is on is Ocwen out of Florida. Who they assigned it to, at least the contact I have is not a lawyer, is that unusual? In fact on his voice mail he is fairly adamant that he is not a lawyer. The 2nd is with More Equity. They had a purchase fall through a week ago because the buyers property had a major issue on an extension to their home and they have to fix that in order to sell, which if they do they can't buy this home.
I do have a good real estate attorney, who I have used for a couple of deals. I guess I was more concerned with if this worth my time and is there a strategy in dealing with the bank or is there a way to approach the bank in such a way that would make this a workable deal?
MN allows foreclosures in two ways, by advertisement and by court action. Redemption is slightly unusual, the burrower or junior lien holder has one year after foreclosure to redeem property by making all the past due payments rather than loan balance after acceleration.
I should have given more background before.
As soon as the 1st mortgagee initiates foreclosure, the 2nd will be named as a defendant and the 2nd will likely foreclose, too. Despite not missing any payments on the 2nd, the fact that the first forecloses is cause to foreclose.
The only chance you'll have to short this will be with the 2nd... but if the 1st is an FHA or VA, a short will be unlikely.
My guess is that the G-Man will have to step up to the plate and bail brother out.
Wanted to update on this thread. I did go out there a second time, actually a mortgage broker that I work with joined me. We couldn't find a way to fit their needs. I told them worst case is in a month or so if the property does not sale give us a call and we might be able to work something out because by that time the 2nd will already be in jeopordy. G man brother can't help because his credit isn't all that great and he is living with his girlfriend who is crazy (hey their words not mine). Anyway what is strange about this couple is they have exotic birds and bird cages worth well over 25 grand. Having the birds and cages is more important than the house, kids schooling, and well anyway who am I to judge... thanks to everyone who gave me their thoughts and advice.
How backwards is this G man? Explain to him it's either his job's security or his bird fettish! Selling the birds & cages could give enough to satisfy the 2nd, if a short sale will be possible! Then his standing will be intact.
That was my point, the birds and cages are owned by the sellers of the house. The G man is primary on the 2nd and has no money or credit to help in the situation. While meeting the sellers the conversation went like this:
wow, nice birds, you have 7 of them, how much is this one worth? Oh 2-4 grand, wow. And these 8 cages they look very nice those are what about 2-3 grand. So you guys could sell these birds and cages pretty quick for well over 20,000 right?
Seller Repsonse:
...oh no we would never do that!
Although I do see your point, I could possibly talk to G Man to provide leverage to the sellers. Let me get the number to Homeland Security. [ Edited by scott_mn on Date 07/24/2003 ]
This all sounds silly walk. The secret clearance stuff is nuts I know I have been there ...ie high level clearance............
To many things are really gooffy and also you are dealing with disfunction .......this has nothing to do with persistance........
It is about disfunction and a good way to get your $$$$$ tied up or at risk!!!
That is why I go for the trustee sales it is simple relatively with rules that everyone must live by and the juniors get wiped out if/when 1st forecloses!!
SKI