Buyer Not Making Payments...
I would like to ask a quick question that I'm sure has been addressed on here before...
What do we do as a sub2 investor when the new buyer stops making payments on the note that you issued them? Certainly you could try for an eviction but that works much better on paper than in real life.
Your advice is greatly appreciated.
Boss,
Well, you mention a "Note" in your post, so I'm assuming you mean when you sell a house purchased sub2 with some form of seller financing.
This, as well as getting a defaulted tenant or tenant buyer out, would require the same thing.
A competent local RE attny to handle it.
With a tenant or T/B'er, yes, you evict, and with a buyer, most likely foreclose, but this really depends on your local state laws.........hence the reason I direct you to an attny for the first one at least.
HTH,
Jim FL
_________________[ Edited by rajwarrior on Date 03/10/2004 ]
Foreclosure is the remedy. In CA the first step is filing a Notice of Default. Rules vary from state to state as to the period when the note may be brought current.
Another issue is that after you foreclose the owner is still occupying the property. In some states you can get the sheriff to evict immediately. Again, in CA we have to start an eviction procedure. Keep in mind that at that point you do not have a normal landlord/tenant relation since you never agreed to rent or lease to the owner. I believe the proper term is tenancy in sufferance. This means that eviction may be significantly easier even if you have liberal landlord/tenant laws in your area.[ Edited by edmeyer on Date 03/10/2004 ]
I remember an online chat, with John Ca$h Locke, where he mentioned that he first trys to offer to buy the house back (for only the uhaul money) and then resell again.... It's worth a try.
-Pete