Found foreclosure...what to do now?! - Posted by Coni(OR)


#1

Posted by Tom Brown on December 10, 1998 at 11:33:09:

One of the first things you should do is have the owner talk to the bank and see exactly what they are willing to do to bring the loan current. You said that she was $6600 in arrears. I am assuming that is just the loan payments, interest. The owner needs to get in touch with the bank ASAP, because eventually there are going to be attorney fees attached to the balance which typically run 10% of the loan balance.

Also the 125K appraisal 2yrs ago is worthless. Especially if the place was trashed after the appraisal was done. While you are waiting for word from the owner regarding the loan problem, consider estimating the repairs needed. You might also want to get comps for the area and do a market analysis of the property in its restored condition.

At the very least, someone is going to have to have the cash to bring the loan current. If the house was in decent shape you might could borrow the money, but from what you have said, this doesn’t sound like an option.

Remember that properties in the foreclosure process must be acted upon very quickly. Time is defintely your enemy in these cases.

Since landlord/tenant laws vary drastically from state to state, I can’t help you in that regard.

Tom


#2

Found foreclosure…what to do now?! - Posted by Coni(OR)

Posted by Coni(OR) on December 10, 1998 at 10:39:53:

I have found a my first real home in foreclosure! And unfortunately it’s a friend of my family. She is 6600 in arrears and owes $89,000 total. Payments are 829/mo. Home goes to the courthouse steps on January 29th. 2 yrs ago it appraised for 125K. It’s a 3/1; 2500 sqft home with garage. Nice neighborhood, but the home is trashed. She has a section 8 tenant living their who hasn’t paid rent for 2 months because the home is not section 8 approved.(The owner needed to do some repairs to bring it up to code, but never did) There is no rental agreement signed. There is an application but no references have been checked! The tenant obviously needs to be evicted or better yet, removed. I would like to tie this up under a contract to purchase for remaining balance and flip to another investor, but it this the best way to do this transaction? Would it be better if I brought the home current and had it deeded over to me and then flip it? Any advice would be greatly appreciated. Thanks Coni