Phantom Lien Foils Short Sale.
Found a townhouse last month, fmv = 80k. Owner wants out before 2nd forecloses.
1st = 49k always paid as agreed
2nd = 24k no payment in over a year
- Negotiated with HMS (household) to short 2nd to 13k
Almost a month later & everything's set for closing. Today I find out there's a 3rd lien!?!?! And it's with Household, too.
Owner told me she has a $15k personal loan through Household and "they must've secured it with a lien on the townhouse."
Tomorrow, I will talk to Household's lawyer who shorted the 2nd. Any suggestions? [ Edited by panicfilms on Date 06/21/2004 ]
seems like anything more than 7k would make it too thin. Depends on your margins.
Check out the lien... Maybe the seller is telling the truth?
What happened to the TITLE SEARCH!!!! This will reveal all that you need to know!
GOOD LUCK
re: title search
That's how I found out...my real estate attorney called me today with title search results. Since owner had refinanced, I thought perhaps there was a paper error. Couldn't believe it took him this long to find out.
Next, I'm planning to ask household's attorneys to either short the 3rd, or more likely, see if they will release the lien.
Impractical for the bank to short the third since it's two years old and paid current. Then again, they stand to lose my 13k if they don't negotiate. And the fact of whether the owner is current on her 3rd becomes moot if the bank has to foreclose on her second.
Does the part of Household that holds the first know about the part of Household that holds the third?
Can you buy the 2nd? Then you can foreclose and force the 3rd to bring you current, etc.
Sounds like Household might be confused on this so there might be a deal still.
John
[addsig]
instead of the short ask household if they are willing to assign 2nd for 13k. finish foreclosure...wipe out junior lien holders.
Thanks for everyone's advice.
I spoke over the phone with the attorney handling the 2nd. Explained situation and he offered to drop his settlement amount from 13k to 10k plus he'd convince the 3rd to settle for the 3k difference. All this to close before the end of the month.
I will know for certain tomorrow. I guess timing and luck are coming together for me this month.
I just completed a similar transaction with Household. I didn't pay them anything for the "3rd" (personal loan). I simply requested that they remove the lien. And they did...
Anyone have a contact name/number for Household. Just got a call on a possible ss and apparently thats the lender.
thanks!
Anyone have a contact name/number for Household. Just got a call on a possible ss and apparently thats the lender.
thanks!
800 333 5848
I've run into a lot of bureaucracy. Perhaps because yesterday was the end of the month also and the end of the quarter.
They are willing to negotiate, however, only after they receive a COMPLETED package. Don't ask anyone to speculate, just get them the docs they request and maintain phone contact.