Buy The Note, Not The House Then Foreclose
Thanks in advance to anybody who can shed some light on this Idea:
SSPro, Mr. Locke, Bargain
Sorry re-post from commercial site
The real question is can you buy a mortgage note at a discount and then continue the foreclosure for the original value?
100k note, buy at 60k, foreclose for 100k? (ex, figures)
Deed in Lieu of foreclosure, not possible, owners gone, don’t want to be found, I’ve got my process server on it,
Essentially you get an assigns and keep on trucking with the foreclosure
Example:
Note: 100k
ARV: 100k
Buy the note at 60k and continue to foreclose at 100k
Nobody will bid, except me $100, and I will end up with the house anyway
I called the mortgage Lender and they want an offer on the note.
If this works the owner is gone and it doesn’t matter, pretty house
David
I was reading this and I had a question about buying the note and what happends if foreclosure comes.......
You would have to handle the foreclosure fees right? so you would have to make sure you are buying the note at a low enough price to still turn a profit when the whole foreclosure prossess starts right? Or is it buying the note while in the foreclosure prossess, if it is then the lender would have already covered the fees right?
Ok so once you buy the note.... you set auction at an odd time so people hopefully dont show then you still bid? even though you paid for the note? If people dont show can you bid like 100 bucks and buy the house?
The minimum bid is usually the outstanding debt on the specific mortgage in foreclosure at auction plus arrears. If you own the note, you can specify what the opening bid is. You as the foreclosing note owner automatically have the opening bid. If no one else bids, the property goes back to you, the Beneficiary.
We usually start the bidding at $100.00 to minimize the amount we pay in DOC Stamps. The rate is$.007 of the bid amount, so a minimum of $.70 is what we aim to pay. A 100K bid would cost $700.00 in transfer fees, for example.
You actually pay out no money on the bid as long as the bid is under your judgment amount.
[addsig]
This is how the telephone game works, as of this point this is the very worst interpretation of the new Home Equity Theft Protection Law that went into effect on Feb.1 in NY state. You have grossly exaggerated several facts and a fair question would not have insinuated ungrounded facts, only asked the question pertaining the the new law for insight. I will post at another time some information on this law, but it is a disclosure period of 5 days and the 2 year part pertains to Redemption based on fraudulently obtaining the deed and sale of the property.
Thanks for the clarification, any more info you have on the new law would be greatly appreciated
The key to the Act is to retroactively protect a homeowner who has conveyed a deed to a predator who has made false statements intended to defraud the distressed homeowner.
The Act requires foreclosing lenders to issue consumer education notices warning about scams.
Failure on the part of lenders to properly advise distressed homeowners could result in the nullification of the foreclosure action.
Any transafer of title in material violation of the Act is voidable, and can be rescinded by the Seller within two years of recording the deed.
AWESOME!!
Welcome to the forum.
Congrats!!
That was a great story. I wish much future succuess.
That is a great story, thank you for sharing with us. There is much to be learned here.
I also learned the hard way NEVER to allow the sellers to remain in the property. I move them into another one of my properties. If I do not have a house they like I refer them to another investor. I know other investors may disagree but in my experience the posibility of problems is too great.
Keep up the good work!
GOOD DEAL$ TO ALL!
1) have the careless listing agent agree to reduce the commission, and
2) have the seller contact the lender and ask for an expedited short sale consideration. Get ready to help the seller prepare an application including gathering tax returns, bank statements, credit card bills, etc. The real estate pros will be responsible for providing market data in support of a short sale.
Perhaps the foreclosing mortgagee will accept your property appraisal...
The lender may or may not agree to consider accepting a nickel less than its due.
Does anyone know about the 10 - 14 day review waiting period for an Authorization of Loan Information? Does it really take that long?
Does Citibank take payoffs that are in the 4 - 5% range (i.e., $42K down to $2K - $3K)?
Thank you,
Donna
"If this home forecloses they will get nothing, correct?"
That depends. How much, if any, a junior lienholder recovers is subject to how much is bid if the property goes to foreclosure sale.