Need Quick Help On Foreclosure????
I have a sister that has lost her way in life and is walking away from everything she owns (drugs)....She has a house in good condition appraised one two years ago at $75000. She has a mortgage of $50,000 that is being foreclosed upon. She has arrears and penalties and attorney fees adding up to $56,000. That amount would pay off all debt. She is not interested in any equity....she is going to lose it and is willing to let it go for the payoff. Would it be smart for me to just buy it off at payoff or try to short it and get it a lower price.....being a brother is a problem in this state....they won't let me do it, but I could find someone to short it and give them some compensation.....The house has 15-20000 dollars equity at this time....do you think the mortg. co. would even consider a short.......thanks
If your state is like Calif you can pay the arrears and legal fees, have her deed it to you, and take over.
If there is that amount of equity, a mortgagee approved short is unlikely.
Even at the payoff of loan balance it's a good deal. But better act quickly.
Your sister could execute a deed in your favor, and you could try to reinstate the loan by paying all past due payments, etc, but be advised that he mortgagee might not have an obligation to accept the past due payments and reinstate the loan.
Before you lay out a nickel, you'll want to investigate property taxes, and any liens which might complicate the transaction.
Why Short it?
Taking it and re-selling it according to the exisitng mortgage?
Afterall didn't YOU SAY:
Quote:"She has a house in good condition appraised one two years ago at $75000. She has a mortgage of $50,000 that is being foreclosed upon"
???
Have your Ss. Deed it to you in a Land Trust (You as Trustee) then place an Add in the Paper saying...
Own My $80,000.00 Home:
No Credit Check No Qualifying!
Owner Financing ! Good condition
First Offer Over $50K + $10K Down
Moves In! Call: 555-555-5555
And see if you can't Sell it quickly!
Hope this Helps!
Derrick Ali
I'm not sure she can deed it to me while she still owes money on it.....or if that is possible, then her bad credit from late payments will be transferred to me, won't they????
Hi jackdevlin,
The good news is that yes she can deed it to you while she still owes money on it! Any bad credit or late payments from her, wont affect you if you buy subject to.
If you are not familar with buying Subject-to the existing mortgage, I would just go ahead and pay off the property with a new loan. Unless you can influence the BPO heavily, the chances on the banks doing a short on this are very low!
A house in that price range that has $15-20K would be worth it to go ahead and cash it out with a new loan.
Best of Success!
BAMZ
I have spoke to the mortg. co. and they will accept full payment up until foreclosure date or payment of arrears and other fees. The taxes are paid to date and homeowners is in place, checked with the county and no leins against the note at this time.
I haven't had any luck getting a bank to short with that amount of equity. Mixing business with family may be of more risk than the 6 grand. Sounds like a good business deal though.
If you are going to cash them out, you should call the lender and ask if they will accept a payoff of the principle balance only as full payoff. That would save you a few thousands dollars and the worst they can say is no!
BAMZ
Man,
I would reinstate, make the payments and go for the 10 down and 55K thing. Since you are a relative, the quit claim is harder to dispute especially if sis had a drug problem.
C-
I have enough cash and home equity acct. on my own home to pay off the mortgage....should I use cash or use take out a mortgage on it....she has left the house and I have renters in it now, paying $180 above Mort. payment....lease is until Aug...and they say they might be interested in buying at that time.
Hi Jack,
If you go out and get a loanfor the house now, in order to keep PMI cost off the mortgage, they will require you to put 20% down of the purchase amount. I know you've got the cash/line of credit now, but you will need to keep that 20% tied into the property until you sell it.
A good alternative is to go ahead pay cash, and the start a refinance right when you close. The refi will be based off of the appraised amount, and you will already have the necessary equity in it to keep pmi off. Meaning no money out of your pocket and in addition, you will have your cash back in about 30 days!
Best of Success!
BAMZ[ Edited by BAMZ on Date 12/05/2003 ]
I appreciate everyone's input......please continue if you have any further input. These ideas give me some options I would not have thought about.
thanks
Sorry to hear about your sister man.. hope she gets it together and pulls thru..
i'm also sorry to hear about your sis .the both of you are in my prayers. good luck on the house