Opt One Wont Waive Deficiency ....best Way Out
I have a seller under contract who is just about to go into preforeclosure.
She owes 270 and has arrears 10k at this point. No hope of bringing current.
Needs 60k in repairs
ARV is 330.
Bank will build up added expenses of $50k by the time they foreclosed/evicted.
I had it under contract for 180k and was trying to get them to waive the deficiency but the lender option One refuses.
I am not willing to saddle her witha huge deficiency even if I can get them to agree to the 180...
what strategy could I advise her to take to minimize her damage?
John
If you offer to hand the house back over to the lender, then the lender will only put the house up for auction and if the house doesnt sale for a cost to cover the fees for the auction, attorneys, commissions and closing cost the home owner will probably still receive a judgment for the balance. What you can do and probably the most best method is to take the house over subject to the financing and rent the house out to own, and see if you can get a tenant to put down x amount of dollars. The lender may accept less than $10k, they might accept 4-5k, which means if you can get more, then the amount left over goes into your pockets. But in order to talk to the lender you need authorization from the homeowner. You can simply get the homeowner to write the name address and ss number on a piece of paper and write a sentence that say they give you permission to speak with the lender. Then get them to sign the bottom. Hope this helps.