Posted by mei122@aol.com on January 13, 2004 at 17:26:04:
A seller recently called me to find out if I would be interested in purchasing her home. She filed a chapter 13 bankruptcy a year ago with a discharge three years from now. The bankruptcy included the house and some unsecured debt.
The mortgage on the house is 17 years old. Her balance on the mortgage is $30,000. There may be some arrearages also. I will meet with her to get the exact figure. The total amount of her bankruptcy filing remaining is $55,000. The house has an after repair value of $85,000. It needs about $5,000 in repairs.
Can I contact the trustee and the mortgage company to see if they will agree to a short sale (after having executed a contract with the owner of course)? The mortgage company is not making much money with the loan since it is 17 years old and was a 30 year mortgage. I would offer to pay off the balance, for a discount of course, that way the mortgage company can move on. I would give the owner some money to move out. I would then flip the property to one of the investors on my distribution list.
Is this a viable plan? The owner is all for it since having the mortgage paid off will drastically reduce her payments to the trustee (over $900 per month). Any suggestions?