First Pre Foreclosure Please Help!
ForeclosureInvesting
Here are the details.
Fair Market Value 150,000
Going to the auction block in one week
Bank needs 82,000
Title Company is doing title search for additional leans
Reinstatement will cost 8,000
Rehab will cost 10,000
I have bought three properties this year and I am familiar with the market. This is my first pre foreclosure deal. I have met with the owners and I am building a report with them. My questions are:
If I sent the reinstatement money to the bank and get a quit claim deed would this be a good way to execute this deal as long as there are no other significant leans on the property?
The have the house listed with a broker how should I go about that? The broker says they can not be involved in a deal where the owner does a quit claim deed. I plan to give the owner 15,000 cash once they vacate the house if they accept my offer. They are running out of options however.
I have seen many posts about subject 2 deals. Would this be appropriate in this case? If so how would a sub 2 work in this case? If the seller will do a quit claim deed my plan is to send the bank the reinstatement amount of 8K give the buyer 15K (once they move out and escrow closes) and make the payments on the loan while I do the fix up and then flip the property.
I sincerely appreciate any comments on if this is a good plan. I will get title insurance and put the house through a normal escrow to help insure that this is done right with the exception of not getting a new loan. I do realize that this could triger a due on sale clause however as long as I make the payments on time I find it unlikely that a bank would want to move a performing asset to the non-performing side of the balance sheet. Thanks again
[ Edited by 58pilot on Date 12/15/2004 ]