Posted by Rich[FL] on January 23, 2002 at 16:00:59:
I am in just that situation. I had a seller call me on a postcard I sent in response to a Lis Pendens notification in the courthouse records. His house is worth at most $95k and his mortgage balance, not counting back payments and penalties, is about $104k.
Now, what can we do? It’s a conventional mortgage with Household Finance. At face value, not much. However, what if we could buy the mortgage from Household? And get the seller/owner to do a deed in lieu of foreclosure (much faster and less expensive)? This is exactly the tact I’m taking; I just faxed the offer(s) to Household this morning. The terms of this “multiple offer - you pick which one you want” is 1) $60k cash; 2) $104k with Household financing my acquisition at a nominal 2% interest.
Will it work? I don’t know; but I do know it WON’T work if I don’t try something .
Posted by Arif TX on January 22, 2002 at 18:53:20:
I currently buy VA foreclosures which at my last count VA had about 9 pages (with 20 properties per page) of properties for sale locally. I also thought about what if I got to these folks before VA did? Paid their back taxes, past due loans etc. and took over their properties.
Where can I get information on preforeclosures? Also what is the best course to learn everything (well almost everything) about them. I did a search in the archives and was blown away at the information provided, thus I will start there. However I haven’t found the info above that I was looking for.
You should already know that in Texas the first public notice of a foreclosure is only 21 day before the sale. There are companies that publish this information. It puts a crimp in everybody’s approach to dominating the market.
Unless you have a covert in to the mortgage company or trustee’s office it becomes a shotgun approach. You can try to find the people that do the preforclosure driveby’s and inspections. You can also get a list of all VA mortgages from some of the services.
Taxes will be escrowed on these loans so no approach there.
Get “How to Totally Dominate Your Forelosure Market”, by Joe Kaiser; available right here on Creonline, for a rather small sum of $ 149.00 You will find it worth more than it’smeager price, and very helpful toward your goal of finding pre-sale properties and sellers.
Now, once you find these sellers, I am not so sure that you will find the opportunity in VA pre-sale properties, that you may imagine. Many of these are overencumbered, and are bouoght back at sale for more than their FMV. Once they go back to VA, then the price is lowered to FMV, or to a marketable figure, which is most times way less than the original mortgage. In these cases, these homes are very difficult to purchase, prior to sale, without structuring a negotiated payoff that is less than the loan. This is again is difficult, and most times not successful.
You may have more success with conventional loans in throws of foreclosure, due to having less of a mtg in place. Hate to dampen your enthusiasm, but just trying to paint a realistic picture here.
Posted by Arif TX on January 23, 2002 at 07:34:46:
OK guys- Let me get this straight. Say I find a property that is about to into foreclosure. The FMV of the house is 50K and they owe 40K on the loan. Why can’t I pay their back payments subject 2 or get a new loan for 80% LTV?
No problem with this scenario, if this is what you find… However, it is my contention that yo will find the reverse situation, a home with FMV of 40K and a mtg of 50K. Now what? This animal is tough to tame in pre-forelcosure, and is best left to recycle to VA, then they usually lower the price to 40K; (just arbitrary numbers).
Yes, if you are successful at finding equity out there in VA homes, then by all means tie them up, and build your fortune doing so. Best of success to you in this endeavor.
