A Deal RUINED!
I contacted this homeowner regarding his foreclosure property. It is going to foreclosure in less than a week.
Here are the numbers:
Approximate Lien/Mortgage: $260,000
Payments in Arrear: $12,000
ARV: $325,000
Fix-up: Minimal, probably at $4,000
I was in talks with the owner, but then a realtor came by their house, and presented them with an option to file for Ch 13. Bankruptcy since the sale date was only days away. They were told to file for banruptcy, then he would try and sell the house at market value, trying to get anywhere from $340,000 - $350,000. As a result, he already listed them for sale. But, this does not guarantee that their house would sell.
Now, as an investor, is there anything else I can do? Is it possible to have them sign a "subject to?" The owner cannot make the mortgage payments even now since he loss his job. If I opt for the sub2, then what will be in it for the owner? What kind of compensation should they get?
What other options can I provide them?
It appears that the Homeowner did what in his/her best interest. Perhaps a bit late, but better late than never.
I'm concerned that the real estate broker (or brokers' agent) dispensed legal advice...
Hopefully the advice was simply, "You ought to consult with an attorney whose practice includes both bankruptcy and real estate..." and not, "You've got to file bankruptcy right away to stop the sale..."
If the Homeowner files a petition for bankruptcy, though the listing agreement might be valid because it predated the BNK petition, any contracts presented to the Homeowner while under BNK protection would have to be approved by the BNK Trustee.
My suggestion? Keep in touch with the Seller and if they are unable to sell conventionally... be ready to step in.
seekingwriter,
Glad to meet you.
When you say you were in talks with the owner, then when you were talking you forgot the most valuable part of the talk, close the deal by presenting your win/win solution.
You let someone else walk up and close the deal you should have had. I would almost bet that this agent did not leave until he had a signed contract with your sellers and presented his win/win solution, which was file a CH 13 and let me sell it for you.
You need to learn what to say and how to say it to close the deal, not over the phone, but face to face with a seller, if not you leave yourself open to the next agent or investor who knows how to close the deal, while you are still in the talking stages with a seller.
Reflect back on what I have just relayed to you and see if you are the one that should have had the deal.
John $Cash$ Locke