Question For An Investor Or Wantabee
I have a question for you guys, you have been very informative thus far, any suggestions or advice would be appreciated, here goes ! in the very near future I am going to be facing forclosure and or bankruptsy and Im trying to avoid this disaster, I have a good amount of equity in my house and am wondering if I were to place an add in my local newspaper stating something like this : PRIVATE INVESTOR NEEDED, For 269,000 loan ,to hold a first secured by a home appraised at 379,000 at 10% interest for one year . must be fast closing, please call ********** Does this sound like it would be an appealing offer for an investor ? If not, what would sound better ? If so are there any other places on the web that I could advertise that investors frequent ? any help needed.
Your ad will probably generate some calls. Here's the problem as I see it, though, and I'm assuming a few things here.
You're wanting an investor to buy off your current note (about $270K) and you pay them back at 10% interest. Sounds good on the surface, but as an investor they'll be looking at 1) do you have any $$$ to put down 2) do you have the $$$ to make the monthly and 3) will you be able (creditwise) to actually get this refinanced in a year? I seriously doubt anyone will lend you the money without you putting any money down, especially if you thinking about BK.
If you're close to losing the house anyway, it may be time to take the blinders off and realize that it's more important to save your credit and good name than the house. If so, it should be fairly easy to move a property with $100K in equity.
I'm not familiar with your market, but from what I hear, CA is booming in house sales. If that's the case in your area, you might want to try to just sell it quickly. Something like "FMV $370K, must sell, First $315K gets it."
Roger
Hi roger, thankyou for the reply, just trying to figure the best way to handle the situation that I am in, could sell house cheaper and lose all of that cash that is accumilated and protect my credit, That is definately one option. but trying to look at it from an investor standpoint and not someone trying to steal standpoint. example : if I had a million dolars sitting in some bank, and I was receiving the normal banking interest rates , and I saw
away of making 10% on part of my money for a year or longer totally secured by a property that if the owner defaulted, I stood to make 110,000 plus ! extra money on the deal, plus the payments he has made until his default , if the owner defaulted I could forclose on the property and sell the house for 379,000 plus. ( probably 425,000 plus w/ our mkt )
why would I care what the credit score of the property inhabitant has ,or if he could repay ? what do you think ?
the down payment that you mentioned would be the 110,000 that is in equity, since I would be investing 270,000 into a 380,000 property that could be mine to sell as I wish in a year, this would be my line of thinking, what do you think ?
Murphy,
I agree with the first response, a lender wants to gauge your ability to make timely payments back to them. If you aren't making payments now, they need to understand what will be different with them as the lender.
Your scenario of 110k "plus" to the investor is not very likely. The typical scenario of a default,is that the investor would have to pay for legal fees to enforce the foreclosure process, plus if you decided to use delaying tactics with BK, the investor would have to pay for those fees as well. Then,when he finally forced the sale he would only be entitled to recoup his investment amount, interest, plus recover legal fees & expenses. The "plus" only happens if no one else bids on the property at the foreclosure sale. Then he would need to enforce possession (more legal fees) make sure he paid any outstanding property taxes, pay a contractor to fix up your property, pay an broker to sell it. Then whatever was left , assuming he did get the property back, would he get the "plus". The investor has to determine if you are worth that risk for 10%.
Professional Hard money lenders will typically only loan 65% of LTV ,charge points of 5%or more, plus 13-15% annual interest for this type of risk. You may be able to find an amateur willing to loan under those terms, but I doubt anyone with experience would think 10% is enough.
Try getting a smaller 2nd Mortgage from a private investor for the amount you are in arrears with your 1st mortgage. That should get you out of foreclosure & buy you time to sell the property for a better price with less time constraints against you. Or hopefully you will get back on your feet & start paying the mortgage on time.
Good Luck
thank you, that was what I was looking for, an explanation as to why that would not work, and your right the legal fee,s if should eventually forclosed would make the deal not so attractive. anyone else have any other idea,s ? love to hear them, just looking for all of my possible options.
Sell quick, and take what you can get. Quite often, the lenders will put the foreclosure on hold if there is a legitimate purchase offer on the property to let the sale go through.
The type of investor you were trying to find, is not generally interested in owning property, they are money people, (like mortgage companies). They are more interested in your ability to pay than their ability to foreclose and take your property.
Good Luck,
Jeff
murphey,
You have to understand that most people who have that kind of cash are not earning 1%. Most of the ones that are would be to scared to do anything else.
But there are a few who are tired of earning a very small return so do not give up complete hope.
I am also sending you a link so check your private message box.
thank you guys, I have alot to think about now ! what ever I do I have to do it quickly, I guess I am looking for a new type of investor and not a seasoned, I guess, some one who would like to make more interest on thier money and not neccesarily make a complete living doing this, someone that has a ton of money that they dont know what to do with, But those kind of investors are hard to find in a short nick of time. thx guys if I get myself out of this mess hopefully I would like to one day join the ranks of some of you guys. kevin
Kevin-
Sorry to hear about your situation. I'm about to disagree with just about every response you received. I think you will find an investor to do just what you explained (although the rate would be above 10%). The problem is the investors who are willing to do this are only doing it to acquire your property at a discounted rate. In other words, take advantage of your current situation. I assure you that this does in fact happen.
I think you should retain a lawyer. There might also be a "deal" you could work out w/ your current mortgage holder.
Best of Luck.
Details, details, both God and the Devil lie in the details.
Why are you facing the BK/foreclosure? How much equtity in the house?
equity is aprox 165,000.00 . to answer the question in regards to BK and forclosure: this past year have been out of work due to back injury, I am now working again and am self employed, and doing quite well, but only have a record of income and loss for the past month as a self employed, the long and short of it is that I got behind on my mortgage, and I could and would catch up in a few months, but the mortgage company is not giving me that much time, you know the old saying, " to little to late" ? as far as BK , I will only do this if I have no other choice , Basically to hold up the sale of the house, buy more time I guess.
it appears that you no longer have or will any time in the future have the money to maintain the mort. i depends on how much time you have before b/k or f/c. but if thats what you are faced with and have no other way out {and that what you seem to indicate} its time to take action before the creditor "wolf" appears. sell it as soon as possible. you are gambling with little time and you can " lose it all" i know i've been there. move quickly....ggod luck..kenmax
Murphy,
I think I can guide you to the resource to help you. There is a way to keep your home. I know of two options. One can help you with as little as 48 hours before auction sale and the other takes approximately 4 to 6 months but it will actually give you free and clear title to your home.
If you are interested let me know and I will give you the information you need.
I live in Atascadero, 10 minutes from Paso Robles. The market is so hot that I'm sure you could sell your house in less than a month and if the price is right probably sooner! $379,000 sounds very low I'm sure it's worth more. We had our home appraised 7 months ago and then again last week and it has jumped from 440,00 to 500,00. I would NOT foreclose and give away all that equity. Why not sell and save the money and when you get back on your feet buy something then. Also with that cash you could save yourself from Bankruptcy,if needed. Take it form someone who both foreclosed and had a bankruptcy it will haunt you for years! This was 8 years ago and it's just now stopped hurting my scores. No amount of money can fix your ruined credit...not legally anyways. Hope this helps Lisa :-o
Just a suggestion:
Sell your home to an investor for whatever you have too to pay off leins. Then lease option it back from him at a preset price. That way if you default the investor is safe and if you fulfill your end of the bargain you don't have to give all your equity away. As some like to say WIN / WIN.
Just my two cents. Good luck.