Attorneys, Probate And Short Sales
Hello TCI
Its been a while and I'm back because I have questions. I want to buy a house that has a 52,000 nortgage on it. Its going to foreclosure soon. It's worth about 80,000 as is. However its needs 20,000 in repairs. resale value conservatively $126,000. last years comps of the area not in the subdivision. The tax assessed value is $124,000 alone
Obstacles:
The heirs want to get paid something like 5,000 to 15,000 dollars for their interest in the house.
The lawyer is motivated but she wants to protect the family. Also she ask that can I send her a letter of credit saying I can do the deal. Not really a problem because they are somewhat desperate and any buyer is better than no buyer
The bank want their money and then some and if it goes to auction there is a chance that it might get snatch for more than the person owes. However, most buyers in the neighborhood wouldn't drop their cash on it.
Because its not in a desirable neighborhood
My plan: I am trying to short the mortgage and pay 32,000 to the bank and 15,000 dollars to the heirs as ocnsideration for the deed. Or just pay 70,000 and hit the heirs off with the remaining balance. Also I want to flip the contract to an investor for $6,000 to get it over with.
Question: How can I pay the heirs so it doesn't show on the HUD-1 Sheet. Or more inmportantly instruct the buyer if it comes down to it to him paying the heirs. I was thinking a prommissary note in the amount of what we said we would pay them and I just ask a higher assignment fee and pay them through those proceeds .
2. What are the chances are me shorting the mortgage of someone in probate.
3. How can I convey this to the attorney so she understands and know what I am doing.
Please help
Couple of problems.
Is the place in foreclosure? Is there enuf $ in the estate to keep payments current until a buyer is found? A bank tends to only SS if they are already in the foreclosure process and only if there is no money in the other assets of the estate. Also, "the sellers are to receive no money from the sale of the home" is a stipulation of a SS agreement from the bank.
Probate SS work great if no equity and the estate is broke.
Numbers look like a Sub2 might work. Anybody else's take on it? If bank thinks too much equity, no SS for you.
Buy & flip?
Just some thoughts since the pros have not chimmed in yet,
Kelly(WI)
Go buy the note from the bank (in the name of a straw man or in a land trust) at whatever discount they will take even if that is none. File the foreclosure immediately. Don't worry about the relatives, the estate, whatever. Push the foreclosure hard. my guess is the estate's asking price will fall like a rock. Worst case you continue to foreclose and take the property that way.
Oh, by the way, the bank isn't getting any more than the face of the note and the fees to collect. Nor are they really interested in more than that. It is considered immoral for banks to try to profit from foreclosures-- unlike greedy real estate investors who are supposed to do such things.