Advice on getting Junior Liens Discounted
Hi guys, I am working with an owner in foreclosure and at first this deal is a no go because the loan balance is more than 80% of the value of the home. But here's the kicker, I think if I'm able to get the 2nd lender to discount their lien then there's a deal.
So my question is, what's the best way to negotiate with a lender holding a junior lien to accept a discount?
Thanks in advance.
Jason
Tell the guy in second position that you have knowlege that the first is going to get foreclosed on.....then tell them that your specialty is buying the properties at trustee auctions and that if you can make a deal now for a discount on thier second that they will get some money rather than nothing if you go buy it at the auction. I would also if you can get the info the bad history of payment from the sellers on thier first note and tell the holders of the second that you will give them say 10 cents on the dollar or a max of 15% of thier note value. They will bite on it if they know what is good for them. You might have to do some homework as you would on a short sale but It might be worth it. If they are unbending then I would wait for the first to go to auction and snap it up. Then after you buy it and wipe out their second, call the lender and let them know that you were not kidding and you now own the property. Then in the future they will not be so easy to discount what you say and will definately deal with you on other properties as they will know you are a serious investor at that point. Good luck to you. and may all your deals go well.