Bad Foreclosure Situation. Any Advise? - Posted by Tim W. (NJ)

Posted by JoeKaiser on May 30, 2000 at 23:27:20:

That’s an old email address. Use the nothingdown address. I’ll get those pages out to you. Weird.


Bad Foreclosure Situation. Any Advise? - Posted by Tim W. (NJ)

Posted by Tim W. (NJ) on May 26, 2000 at 22:47:07:

Just spoke to a man who is in a rather thick mess and when all is said and done, he’d really like to remain in the house. (As do most people???) From what I can gather, this is the situation.

House is due for foreclosure in June, not sure when. Mortgage is $122K and his realtor said after fix-up value could be about $150K, which should be close enough for hand grenades. His monthly PITI is $1178. As of 6/1/00, he’ll be 8 months in arrears on the mortgage.

His situation has gotten to the point where it is due to a bad marrage and a young, elementary school aged disable daughter, among other things. His wife had been paying the bills and then one day, after not making the mortgage payments, she threw it into his lap.

He tells me that he would like to keep/save the house from foreclosure. He states the most he could pay (comfortably) would be $700.00 a month.

I’m thinking it might just be better to let it go to foreclosure and be at the banks doorstep the next day to make a discounted cash payment as an REO.

The house, while only about 40 years old, needs a good deal of rehab, like carpet, painting, landscaping, etc. (Have not been in the house myself)

Any suggestions?

I have a pic I can e-mail to anyone if it helps to get a visual of the house?

Thanks in advance.

Re: Bad Foreclosure Situation. Any Advise? - Posted by JoeKaiser

Posted by JoeKaiser on May 27, 2000 at 01:09:46:

Don’t turn his mess into your mess.

I suspect the $122k doesn’t include the back payments and he likely owes more than the house is worth. This would be a skinny deal even if the house didn’t need any work.

Where’s the upside here?

The whole point of all this is to generate a profit somewhere along the line. Frankly, I just don’t see one here.


Re: Bad Foreclosure Situation. Any Advise? - Posted by eric-fl

Posted by eric-fl on May 27, 2000 at 24:04:53:

Ok. So the mortgage is 122k, the After Repaired Value (ARV) is 150. You didn’t say how much he owes besides the late payments, so let’s assume this is a newer mortgage and he’s paid off virtually no principle. In addition, he is behind 8 payments of $1178, which by my calculator is $9424, which brings his total obligation to $131k and change. You also said it needs “carpet, painting, landscaping”, so let’s add in 5k for that. Now we’re at 136k, on a 150k house. Don’t forget closing costs, carrying costs during rehab, and advertising and remarketing costs - unless you want to sink in about 20 large, CASH, on a sale/leaseback, to someone who can only swing $700 a month, with an $1178 payment. (I wouldn’t). It looks like there isn’t enough equity for an outright purchase, but you may be able to work out something with the bank if you call them up and offer to buy off the loan at a discount - then ask them to finance you for it! You’ve got nothing to lose by asking. I don’t see any immediate way for this guy to keep his home without you, or somebody else, assuming a disproportionate amount of risk. If you can negotiate a reduced note purchase with the bank, offer him a couple grand to quit claim his interest so he can move and start over.

Re: Bad Foreclosure Situation. Any Advise? - Posted by dew

Posted by dew on May 28, 2000 at 22:04:09:

Joe, Got your foreclosure manual and emailed you at Haven’t heard anything.
I’m missing pages 155-160 and 185-188. Plus I had a couple of other questions. How do I get in touch with you? D.Wolta P.O. Box 24262 Denver CO 80224-0262.

thanks for your input. dew