Why Hasn’t The Lender Foreclosed?
I posted this elsewhere (same scenario, different question), so I thought I’d try here for some insight.
Owner hasn’t made payments in 2 yrs so what are some of the reasons the lender HAS NOT foreclosed on the NY investment prop?
There was a fire in 2002, insurance didn’t pay because policy was written as OO instead of investment. (I will look at closing dox to confirm this). Hence the non-payment for 2 yrs. LSC in FL sends monthly statement w/arrears ???
Why hasn’t the lender foreclosed? Are there some underlying legal implications?
do you know the owners? What is their side of the story.
If they can't help you, call up the bank, thell them you have a nearby property and are tired of looking at a burnt shell (or whatever it is); someone might start talking and letting you know what their position is.
If the lender forecloses and nobody bids on the property, the lender ends up having it with all the concequenses. You did not say how big is the damage but
1. The property in its current condition may have code violations
2. The soil might need extensive cleaning
So, foreclosure expences+low property cost (much lower then it was when the owner received the mortgage) + paying fines for code violations of fixing the property + soil = no foreclosure.
However, if the owner had a deep pocket they probably would excersize a judicial foreclosure and make him pay for everything.
YOU GUYS ARE AWESOME!!! Now I have a better understanding. I was completely baffled as to why there was no foreclosure action after 2 yrs.
I'm going to see how much fire damage there is. I'm told the basement is burnt out. It's a small 3 unit semi-attached on a HUGE lot. SO, what I need to do is determine what it will take to bring this house to market (repairs, enviornmental, etc.) & proceed accordingly.
Thanks so much!
I checked the closing docs and there are 3 different forms that speak to occupancy
loan app - OO
affidavit of occupancy - NOO
closing certification - NOO
he did have the insurance policy
The homeowner used the seller's attorney.
The loan was sold to the current LSC.
I'm not sure what to do now. There's value in the prop given the market, but this whole OO - NOO smells fishy. Nobody picked up on the error until the fire occured. ???
Anybody experienced or heard of something similar?
Get on the phone. Call the lender. See what they have to say. Ask if they want to discount and sell the note. Ask to see the initial underwriting package if they say yes.
OO versus NOO probably doesn't get the insurance co. off the hook. Stop guessing what the other guys are doing and pick up the phone and ask them.
I'm on the phone first thing in the a.m.
Get your brother to sell you his interest in your property. Then you pay the taxes and also get the benefits of your property