Need Pre-foreclosure Advice
Very new to this site. Just learning about short sales. I would like to short sale a property I own to a friend (or anyone really) looking to get into RE. I lost my job approx 1 year ago, new job ain't cuttin' it.. I own a 4 unit apart. blg with 88K 1st and 20K 2nd. Building is worth 100K+. Have had on market for 111K for 2 months with no action. Foreclosure was filed by 1st mtg approx 3 weeks ago. I want to offer 1st mtg bank (Litton Loan) 75K and 2nd mtg bank 10K (Liberty sav). I also want to put in loan 5K for repairs which means by friend would purchase property for 90K. I have sent for SS package and believe I can qualify. Building nets $1500 per month. Questions and opinions: Will the 1st mtg lender let the 2nd have any money? Will they allow for the $5000 repairs? By the way the 2nd mtg is 1 month in arrears but I can bring it current.
johni554,
I think you should read up more on short sales before doing it. There are some articles if you click on the "Articles" link at the top of the page and then "Article Topics." You will see a heading called "Short Selling," that is the section you want to read the articles.
You can short sell the property to a buyer, but you cannot short sale the property to yourself. Since you owe the bank money, then they will agree to a short sale as long as you do not receive any money from the sale. You and your friend will have to put the house under contract for the amount your friend is willing to pay for the house. Your friend will have to show that he is pre-approved for a loan or has proof of funds in the bank to buy the property. The bank wants to know they will get paid if they agree to a short sale. I'm not sure where you're getting at with the question about repairs.
I think you are confusing yourself and you need to read up more to better understand how a short sale works before you pursue it.
Tanya
Well. I am sending my SS package today. Current situation is 88K 1st and 20K 2nd mortgages. My friend is willing (I think) to purchase my property. I am asking the 1st to discount to 75K and 2nd to discount to 10K. I wrote the contract for 90K with 5K in repair costs to be transferred to buyer. I guess I will see what happens. Thanks.