Re: Newbie- Report (Comments Please) - Posted by B.L.Renfrow
Posted by B.L.Renfrow on June 08, 2000 at 10:33:07:
This sounds like it COULD be a decent deal…but you are up against a wall due to time constraints, at this point – ESPECIALLY if the seller is making himself hard to find.
I’m a bit confused though. Is this a municipal TAX SALE, or is it a LENDER FORECLOSURE? You make references in your post to both situations. Which is the case?
When you say you have “contacted my bank so I could have the funds available for a subject-to deal” are you talking about the $3k necessary to bring the loan current?
If so, this sounds, on the surface, like an excellent subject-to situation. HOWEVER, a big problem, with the sale scheduled for tomorrow, is having the time to perform the necessary due diligence – like a title search, to determine if there are other liens or attachments the owner “forgot” to mention, checking with the lender to determine the actual loan balance, etc. I suppose you could always make your deal contingent upon these factors…so if the seller is being less than honest, there’s no deal…but then you’re out the $3k in the event things aren’t what you have been told.
I don’t mean to sound cynical…but it’s just good business. Sellers conveniently “forget” things all the time. You should plan on verifying EVERYTHING they tell you. For example, I just did a subject-to deal myself, had the attorney do all the title/record searches, etc and all was OK. Went to have the city turn the water on yesterday…OOPS…seems the seller’s tenants left an unpaid $200 water bill. In my town, they don’t attach liens for water bills…they simply won’t turn it back on until they are paid. And I KNEW enough to check…just let it slip by. Technically, it is my seller’s problem…but guess who is going to have to take care of it. Not a big deal, but just an example of how things can sneak up on you.
If your deal is a lender foreclosure, perhaps the seller could get them to postpone the sale a week or two – if they can convince the lender the loan is going to be brought current right away. I sure wouldn’t hold my breath on this, however.
It sounds as if the seller may have simply given up in this case. If that’s so, and with the sale tomorrow, I suspect you may not have enough time to pull this together.