Bad Countrywide Foreclosure Situation
Okay, so I have a 2nd mortgage on this guy's property and now the guy is mad at me and accusing me of all kinds of crap. The foreclosure is not far away and the sales in our area generally go for 90 to 100% of the FMV. With the 2nd mortgage I think I'm a bit under that 100%, but I'm really not sure how much. Countrywide won't work with me because the guy told them to stop speaking with me about the account. What the hell do i do?! I have a contract that is set to close in less than two weeks. ARGGGGHHHH
I think that you'll have to better explain what is exactly going on because the above post is very confusing.
Roger
A little confused. Are you foreclosing or is Countrywide and who do you have a contract with to sell the property to? If this contract assuming that you will be the owner after the foreclosure?
Good LUCK and Thank You
Hope this helps some
Ted Jr
Apparently I've become incoherent. The 1st is foreclosing, I have a contract with the owner, but now he is not speaking with me or helping me in the least, I wanted to get a better deal on this property, but if he doesn't submit a short sale package, im pretty much shit out of luck. The contract is for BELOW what Countrywide's payoff statement says. I need to scare up another 24,000 to purchase it, and even then I will probably have to evict the occupant.
The Payoff is 179k
My 2nd mort. 25k
House is worth around 235k if i put in another bathroom.
Thanks all!
Why do you have a second mortgage here? Do you try to bring the loan current first?
A couple things. If you're going to be talking with the lender you'd need an Authorization to Release Information signed by the occupant. If you don't have that, as far as I'm aware the 1st needs to send you (the 2nd mortgage holder) a notice that they are foreclosing. I was under the impression that you have the option of bringing the 1st current. I think at that point you'd have to foreclose on the owner.
Ryan J. Schnabel
If Countrywide sees equity they will not do a short sale. I lost one yesterday where the loan was $36,000 and the second behind it was $12000. Second got wiped out and first would not take a dime less than owed.
Good LUCK and Thank You
Hope this helps some
Ted Jr
Yes, they will not accept a short sale proposal as long as they see equity in the property.
You have to make a case that the property is in distress, in addition to the owners financial distress.
The next option is to pay the 1st and foreclose yourself.
Good Luck.
N.
I'm missing something here.
If you hold the 2nd, why will CW not talk to you?
Was your contact with CW regarding a short sale, or did you approach them because you wanted to secure your position with your 2nd?
What actually went wrong between you, the seller and/or CW?
There's some essential info missing.
This is one where I'd like to know a little more about the cause before we can discuss the symptoms.
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They won't talk to me because the 1st mortgage holder told them to not reveal any information to me. The 1st holder is trying to extort money from me now...
Did you mean to say that the occupant of the property has told Countrywide to not talk to you? I was under the impression as the 2nd mortgage holder you have the option of bringing the 1st current. Then you'd have to foreclose, but they can't hold that information from you. If they are foreclosing I'm pretty sure it's a law that they've got to notify you (as 2nd mortgage holder) that they intend to foreclose, thereby giving you the opportunity to redeem the first. I could be totally wrong here...but that's what I thought to be true.
Ryan J. Schnabel
I suspect there is some confusion on terms describing what he has done.
I suspect he signed a purchase offer with the homeowner and now considers this a 2nd, which it is not.
Country wide doesn't recognize this as a lein because it took place after they initiated the foreclosure.
When you say you have a 2nd, people are thinking you were involved with the property somehow before the foreclosure. But I take it that your involvement with this homeowner only started after the foreclosure.
Is this close to what is happening?[ Edited by The-Rehabinator on Date 02/04/2004 ]
You've hit the nail on the head Rehabinator, does this mean that I'm screwed?!
I have so many questions that there isn't enough space here. So first the obvious. Never let the seller be the one to submit the short sale package. Control the deal from day 1. You need to buy some of the good material here and read it. There are step by step processes to use to nail down these deals. Then you will be able to accurately describe the situation to others to get help!
What do you suggest I read so that I can speak your guys lingo? Thanks!
Now that I know a bit more about what you meant to say...
First off your contract to purchase the house should have been contingent upon executing a short sale with the lender at a figure that is acceptable to you.
If you can't complete the shortsale you don't have to purchase the house, so you can always walk away.
If you don't want to, and I'm thinking this is your intention. You want to force him to complete the terms of your contract with him. You don't have much that you can do to force him to work with you.
In the end he is going to lose the house to the bank, or he is going to try to work with another inverstor instead of you.
Now that your situation is a lot more clear I think you are going to hear from others here that you should have gotten a deed from the seller so that you could file it and cloud the title and prevent him from selling to another investor and thereby forcing him to follow through on the contract.
From the nature of your posts I'm going to assume you didn't get a deed. So I don't know what you can do at this point other than walk away, learn from your mistakes and don't do them again next time.
WOW rehabinator nice job on translation, thank you.
Ok so let me understand if I may.
You put in a purchase offer and it was accepted by the home owner and now he doesn't want to sell?
Pretty much, I have an escape clause, but it isn't helping me make any money
Thanks
chaz242,
I wasn't trying to be rude earlier. I'm sorry if I came across that way. I'm also fairly new to some of these newer creative techniques such as shorts. You can't put a value on the info available here. However, It scares me to see new investors get into deals blindly. This site has a wealth of info but the details aren't going to be talked about much on the boards. Things like getting the deed and recording it too early or not having the seller sign a disclosure can get you in some real trouble later. Congratulations on taking action, but make sure you cover yourself. People in foreclosure are desperate and be careful what you promise them. Good luck to you in your investing!
Chaz 242,
As to future deals, read up before you embark again. Most important to keep a firm hand on the hand of the person in foreclosure. You really have to stay close.
So much for yesterdays booboo. Now onward, assuming you still wish to play.
You may of course cloud the title all kinds of way. That prevents him selling to some other hot rod investors. Also if he is annoyed enough he might sue, slander of title, wrong gang sign whatever.
My suggestion is at moments like this you step back and watch the foreclosure sale proceed. After the sale if still interested approach the REO aka Loss Mitigator noh Walter Mitty and start to negotiate on the property. Show the long list of needed repairs, the bad reputation in the neighborhood etc. etc. Remember the REO may still have a problem with the old owner. Unlawful Detainer etc. etc. Just bargain and see how well you can do. When you deal with an REO in todays market there are a few little changes that have just started to occur. Like as a part of offer, the Lender now new owner will extend to you a new mortgage loan, and here you go for low interest and long period of time like 30 years. Sometimes you can capture value in the beauty of the financing which you now emplace.
remember a member of TCI is never defeated, just temporarily stunned.
Lucius
It looks like there might be enough in this property to make some $$ even at the price it is listed at. If this is worth it to you then go for it!
second, you have another option which is to take the property subject to and pay off a deficiency.
get the deed to the property put into trust where you are the trustee and the owner has beneficial interest and lets the mortage company know he is putting property into trust for his own benefit and direct all correspondence to you the trustee etc. and I would at the same time have him assign the beneficial interest in the property over to you so that you now have 100% interest & control in the property with financing in place, and tell the seller you will pay him "X" amount of money at close (when you sell the property) if the deal makes more/at least "X" profit.
HOw much does the seller want from you? you have to be careful on this as giving the seller $ on a short sale constitutes loan fraud.
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