Newbie has seller in Preforeclosure, Help please!! - Posted by Carol, S.Fla.

Posted by BUBBA on October 31, 2000 at 18:59:14:

right off the bat I would say that this is TOO SKINNEY. If you can not make 15k or so I would say PASS.


Newbie has seller in Preforeclosure, Help please!! - Posted by Carol, S.Fla.

Posted by Carol, S.Fla. on October 31, 2000 at 14:14:35:

I’ve been following this board and forum for the last couple months and want to thank everyone for all the wonderful insight I’ve gained into REI from everyone here. I’m brand new to this and would be so appreciative of some assistance. I had a seller contact me today from south Florida who is about to be in foreclosure as of tomorrow, Nov. 1st. She has not paid Sept or October’s payments but after speaking with her today by telephone she said she is able to make up two payments, one today and one Friday. My outlay would be $1229 for November’s mortgage payment. Here are the figures on the house. She purchased it in March of 2000 this year for $125,000, went FHA, mtg payments are $1229 per month plus homeowner’s assn. fees of $30 per month and $22.95 per month for 9 more months on the security system contract. She had a buyer for the house for $129,900, listed with an agent who has now taken it out of the MLS due to the fact that the seller was unable to get a loan to cover the closing costs of $13,000. Seller purchased another home in another state and now lives there and cant afford both mortgages. Seller had not gotten a formal letter of withdrawal from the agent and is getting that in writing today. Seller would like me to purchase the home, and she would be willing to deed it to me and do a lease option for a minimum of two years, and more if necessary. Comps for the area are in the $125-$130,000 range. Repairs to the property are $1950 derived from the recent prospective buyer’s home inspector. However, the house is 12 years old and will soon need a new roof, as was stated that the roof is near the end of it’s life, (customary for south Florida homes in the 12 year range, reports generally come back this way.) Would it be worth it for me to enter into contract with her for the principal balance payoff now of $123,700 when she becomes current and wait on appreciation of property in the next two to five years? I’m fairly confident it would rent for $1500 per month, maybe more. Is this a good deal or should I pass? I’d be looking at future equity but know I could sell now for $130,000. What about insurance and the loss of homestead exemption? Should seller pay taxes and insurance or would I? Any help and advice anyone could give me will be greatly appreciated. Thanks again. Carol, South Florida

Re: Newbie has seller in - Posted by dewCO

Posted by dewCO on October 31, 2000 at 23:18:39:

This is pretty skinny. The “rules” are you aren’t supposed to just depend on appreciation. Once could try to get the lender to accept a short sale, or one could learn about PACTTrusts, which work in this skinny scenario (

Also, she either deeds it to you or you do a lease option with her, you can’t lease something from heer that you own (if she gives you the deed and you accept it by recording it!).