Experts- Anyone Pay FMV For Pre- Foreclosure?
Has anyone looked at pretty houses for purchasing pre-foreclosures that have a large amount of equity in them?
Get a new loan for the FMV of the home, pay off what the bank needs and pocket the equity? YOu would have plenty of cash left over for holding fees till you get a new person in there for rent/lease/buy to pay back your loan. Or sometimes when people are in pre-foreclosure they have had a hardship- maybe they have recouped and can now pay the monthly? Sell it back to them, let them stay, making your monthly payment and rebuilding equity.
But, is there a limit as to how many big loans I can get in a month?
Your thoughts...
I see a few problems with this idea.
First, most lenders won't lend based on FMV value, but rather purchase price.. They especially won't lend 100% of market value in an investor type loan.
Second, it would be a bad move on your part, too. IF you borrowed 100% of value, you'd have little chance to make a monthly cashflow, and you'll be putting yourself at more risk. What would happen if your market took a downturn? What would you do then?
Third, it's pretty much always a bad idea to sell back to the original owners for reasons given numerous times on this site.
Roger