preforeclosure - Posted by Rob FL


#1

Posted by John Behle on October 14, 1998 at 23:26:17:

I look at foreclosures as someone I might be able to help. The primary ways people try to help are to help them by buying the property.

I like to take it a step or two further. I want to know if they want to sell the property or keep it. Of course, if they want to sell it, I can buy it. If you have a license, you could also list it. Using creative skills you might be able to help them and still profit. So, being a buyer is TOOL 1. Being an agent (or creative “flipper”) might be TOOL 2.

If they want to keep the property, I can make them a private loan (TOOL 3). I create high yield paper and a good yield. If the margins are there, I have a safe return too. You might look at this as flipping it back to the seller. I can also do a sale/option/leaseback (flipping it back to the seller on a lease option).

Having lender relationships (for a referal feel) may result in finding them some financing to bail out of their problem and keep their property (TOOL 4). Having a relationship with a credit repair agency (TOOL 5) can result in them fixing their credit and getting better financing (another lender - another referal from the lender and the credit repair company).

Here’s an example. A friend that does foreclosures (Jeff) found a deal. They didn’t really want to sell. Jeff called me. They were in foreclosure, bankruptcy, had the worst credit I’ve seen and were at high risk for a heart attack and even family problems.

The private second was foreclosing and wanted the property. We made a $4,000 hard money 5th position loan to solve the immediate problem. We lined up a $40,000 private loan to take out the second and liens if needed as a contingency - it wasn’t. We then placed a new second with a B,C lender to take out the problem second and bring things current. A credit specialist worked on their situation and a few months later we refinanced them at a lower, more attractive rate with a new first.

Lots of happy people. Plenty of profit and problems solved. I love having more than one approach and tool for solving problems. I also love doing deals that another investor sends to me because they don’t know what to do - he got a referal too.

It also led to loan referals from his family.


#2

preforeclosure - Posted by Rob FL

Posted by Rob FL on October 14, 1998 at 19:35:17:

I mailed out a letter to a homeowner in foreclosure. He responded to me by email. This is the first time this has occurred. I usually get call backs and can talk with the owner on the phone.

His response “about my house, tell me more”

Of course I will ask him the basics. # beds, # baths, size, condition and things of this nature. And I will also find out the amount owed.

I just want to find out if this has happenned to anyone else, and if so what reply would you give to keep him interested. I am just looking for feedback, because I normally don’t talk to homeonwers over email. Thanks everyone.


#3

Re: preforeclosure - Posted by DianeV-FL

Posted by DianeV-FL on October 14, 1998 at 22:49:44:

Hi Rob:

Although I’ve not done one of these before, my foreclosure training indicates that you focus first on selling them on the idea that you are there to help them…help them out of a difficult situation, help them understand the foreclosure process if necessary, and preserve their credit so they can buy another house in the future…then try to get a phone conversation arranged to establish a more personal rapport and build from there.

good luck!