On The Way To The Courthouse Steps
Appreciate any comments on this one. Property is 1 acre w/2 basically worthless mobiles on it. Owner behind $1300 in payments ($210/mo) and hv received letter fm county clerk that the property is foreclosed. I hv spoken w/bank and they advise $16500 balance on mortgage + $2000 in atty fees, etc.
County tax records show property value of $33000 and other mobiles with same land size are assessed at 45000 to 65000. My best quess is that fair market land value is around 40000.
I would like bank to sell me the mortgage at 14500 however even if I pay the 18500 I've got a good parcel. If they deal and I buy the mortage I would let property go to auction and see if someone bids 30000 + and I let them buy and walk away with 10000+. If I can't get 30000 I keep the property (buy it myself at auction) , invest in a 20000 mobile and set it on the property. After all expenses of setting the new unit and getting rid of the old junkers I'll hv 45000 into it and sell conventionally for 75-80000.
My first choice is to get rid of it at auction.
Any holes here , anything I'm missing or should do differently? I've never went down this road before, but hv bought and sold mobile repo's.
Thanks
Dont forget if you buy the mortgage and let it go to auction you would only make the difference between the discount you bought the note for and the default amount. Anything over the default amount legally goes to the original borrower called the "overage"
[addsig]
If the property is in foreclosure, I suggest you get the owner to sign a sales contract with you for the $14,500 you would like to pay.
You would then have to discuss with the bank if they would agree with accepting a loss on their mortgage.
Doesn't seem very likely though, based on what you describe, but perhaps well worth the try.
If the Bank does not go along, adjust the price upward, so that the bank gets paid off at closing.
You then end up with the property free and clear, without the hassles that an auction can bring.
[addsig]
WheelerDealer... do you mean to say that if I bought the mortgage fm the bank let's say at full balance due and then the property sold at auction for $10000 above the amount that was due on the note that the $10000 wud go to owner who was in default and induced the auction and not to me the holder of the mortgage? This person has not filed bk but could.
Hawthorn...
A sales contract with the owner appears to be out of the question. It does not appear that their future "creditworthiness" is an issue.
However I may be able to offer the owners say $1000 if they will sign a sales contract with me.... possibly. Then I cud just settle up with the bank.
Thanks kindly for your input.
Yes Bo,
That is what I am saying. The overage of proceeds (default amt + fee's- bid=overage) goes to the borrower. That is why you want buy a note in default at a deep discount.
Remember all realestate is, is collateral or security for the AMOUNT OWED. A lenders interest is in getting their money back that is legally owed.
_________________
B.G. & Wheeler D. LLc Inc. and Trust
(A division of: Half Vast Enterprises)
"Most american millionairs today (about 80%) are first generation rich"[ Edited by WheelerDealer on Date 01/20/2004 ]
Thanks Wheeler,
I've got it. Actually I've bn interviewing attorney's to select one for advice as I become more active in real estate, and one of them confirmed your insight.
Thanks again,
Bob
bobabby,
These guys here are good. real Good. I've check several suggestions, comments, and advice out and so far, they are right on the money.
Do followup though. You never know who will give you advise next (My 6 yr. old)