Posted by Rich[FL] on March 05, 2002 at 05:52:42:
Ed, I posted some a couple of months ago about a pre-foreclosure I was working on. It involved someone who was way behind on their payments, plus they owed about $105k on a house worth, at best, $95k. Here’s what I did. Since I couldn’t simply make up their back payments to bring the loan current because they were upside down, I decided to approach this from a different direction.
I got their mortgage information then called the mortgage holder (Household finance in this case). I gave them two offers (in light of the fact they told me they NEVER sold off their loans - even those in default!) One was a full price offer of the current mortgage balance, $105k, BUT they would finance it at 2% (win-win; they’d get ALL of their money back, though at a small interest rate; I’d get in with no money down with a small monthly payment - about $380 or so, great for cash flow); the other offer was a cash offer of $60k. Well, they did call me back after about 3 weeks and asked if I’d consider $85k. I said no, they were unwilling to negotiate further, and that was that. Oh well…win some, lose some.
Hope this helps.