Posted by ‘BJ’ AL on February 07, 2002 at 13:40:18:
Boy, I wish I could find ‘a deal’ like that!? The RE agent is foolish for attempting to get full price, especially in such a short time! It would be much better if agent informed ‘seller facing foreclosure’ to take a drastic reduction in price, maybe salvaging some of their equity they may have in home, a small piece of the pie is better that NO PIE AT ALL, and also this way they elimate having a foreclosure on their credit record. That RE agent is looking out for their commission, not the ‘best interest of their client’ in this particular situation. Probably best way to deal with this is for you to ‘inform agent’ that you want to go with them to present ‘your offer’ to the seller.
That way you have a much better way of informing and actually dealing with this particular seller, be sure to inform ‘RE agent’ that you are not trying to ‘cut them out of the deal, that their commission will still be there…(maybe not quite as much) if you can work directly with the seller, you have a much better chance to make this a ‘win-win’ for both you and them.
The seller may not even have enough or any equity in this property, in that case, the best way would be for them to get someone (a go-getter investor,like you) to just ‘relieve’ them of their problem, maybe a couple of hundred dollars or so to enable them to move. In this event, you certainly will need to have your ‘ducks in a row,’ so to speak. You will have to have enough ‘cash’ available to pay ALL the deliquent notes plus attorney fees, plus hopefully convince the Mortage Holder of the property to let you, preferably assume the loan, but more than likely you will have to ‘qualify’ for the loan. You really DO NO WANT to do this, you do not want to have to ‘qualify’ and take responsiblity’ for the loan itself. (This would really limit your future as a RE Investor.) If the RE agent was not involved, you may be able to convince the people facing foreclosure to let you take the property “SUBJECT TO”. that way you would catch up the late notes, pay attorney fees, etc and they would sign the deed over to you. (PS: They would still be responsible for the loan, per se) Then you own the property and make the payments! That would be dependent upon whether the mortage holder would still let present owner 'catch up payments, costs, etc that would cure the present foreclosure proceedings. Probably, best way to do this…if mortage company was in agreement with present owners curing the loan. You make the necessary payments, attorney fees, etc. yourself. DO NOT GIVE THE MONEY to the people facing foreclosure, with them supposely going to make the payments, etc. You would stand a good chance of losing your money plus not having the deal. REMEMBER; Trust yourself with your money and future, not good intentions of others! In this event, probably best not to let present mortage holding company know what is about to take place, they certainly probably would not be in agreement with this proceedure before it actually happened. After the deal, you just make the payments on time, get house insurance on property yourself, etc. Chances are it would be a long time before mortgage company became aware of what had happened, but if you have been responsiblely making payments, etc. chances are extremely slim that they will push the issue! They just want to know that their property is being taken care of and by a responsible person and that their investment is safe! They DO NOT want to have to FORECLOSE! Its a bad mark on the mortage company or bank!
Hope this helps!