Need Some Advice
I have found a property that I would like to pick up and refab while living there 6-12 months. Then flip and sell.
Other facts that might help.
*Asking price 165k
*As-Is FMV 155k
*My offer to current owners 135k
*Owners owe 161k on loan.
I want to finance the property with a FHA 203k for about purchase price + 25k in refab. When completed the FMV should be close to 195k.
The question is as follows:
The current owners are in preforclosure and have filed bankrupcy. I made a ~80% FMV offer to the sellers but they owe almost 99% of FMV on the mortgage.
What options do I have in dealing with the mortgage company to try and find a price that they would be willing to short sell to me for?
I am not a knowledgeable REI, but I stumbled on this site and have learned a lot so far. Thanks for any help or suggestions you all could provide. Email directly to housejd (at)***Must have at least 5 friends to unlock***
or reply here.
I guess I need to clarify some things.
I figure that the sellers have no motivation to sell the property below what they owe + back mortgage/taxes.
If they are already in bankrupcy, then they must be hoping to get a lucky offer that covers their debt. Otherwise, just let the house go and walk away with just a bankrupcy/foreclosure and no debt.
How do I approach the mortgage lender with an offer? Do I need the sellers approval, or can I just do an end around to get the deal done. I figure the bank is 1-2 months away from foreclosure anyway and the owners are already out of the house.
This should be a pretty easy deal, with some good profit potential, I just need some direction. <IMG SRC="images/forum/smilies/icon_smile.gif">
Plus the property has been on the market since Febuary so, the bank must be wanting to get something out of it soon.
As before. Thanks for any help or insight. I just am not sure where to go forward with this, and my contacts in the REI area are non existant. <IMG SRC="images/forum/smilies/icon_smile.gif">[ Edited by FlyingWreck on Date 06/20/2003 ]
FlyingWreck,
If a property is in foreclosure, then you must speak with the sellers in order to purchase the property. The only time you can buy a property from the lender is if they hold the title/deed to the property. Since the lender does not own the property, then you must work a deal with the homeowners (sellers).
Since they owe 99%FMV, then you can consider short selling this property. But, you would need an authorization to release form in order to speak with the lenders about the homeowner's mortgage. I suggest you read up more on short sales by checking out the "Articles" link at the top of the page. Then click on "Article Topics" and "Short Selling." There are some articles you should read to get a better understanding of short sales before attempting to do one.
Tanya