OfflineI want to assign contracts for now, plain and simple.
I have 1 person who owes about 320k on a home here in NJ. The home today is worth around 220k-240k.
Problem is i have noticed that many people that call me owe more to the home than what it's worth. Doing a short sale would not be a problem for me i guess but if a "short sale" would get accepted, how is it possible to assign to another investor?
And what if the short sale doesn't get accepted? Most likely that's the final blow for the homeowner correct?
It's sad to see people in pre-forclosure, makes me more motivated to get some deals done not only for the sake of me but to HELP these people!
What can be done? Anyone in these similar situations?
"Whenever you find yourself on the side of the majority it is time to pause and reflect."
-Mark Twain
Yes, short sale is really the only way to go if they owe more than it is worth. It's not the only option, but virtually the only one that is usually applicable because of the situation of the seller and the home.
A short sale can be assigned, but that might be more tricky due to the nature of things. Someone can chime in if they have done a short sale assignment and how it worked. In theory it could buy the owner more time in the house even if it doesn't go through.
But yes, a short sale is last possible out if the house is underwater and the owner can't pay.
Yes, it is terrible people losing their houses. Sometimes there is nothing that can be done.
If you have the ability to finance it, the best way to make it win-win is to get the house really cheap in short sale, then let the person rent and stay in it. I don't know if you can lease option it to the owner since contracts vary about the owner buying it back, due to the fact a person underwater could straw purchase their own house much cheaper that way.
If they don't bite on the short sale and it does foreclose, you will have a lead on foreclosure. Once it goes into foreclosure, if the price was firm during short sale, it tends to then soften. That means you can take another crack at the price you want it for.
It is a great thing when you can help someone else and help yourself with a sound investment. However, sometimes you just can't help, and over the time this site has been here I have read many posts of people who are serious about getting into a really bad situation for themselves because they found someone in trouble and thing that they can make a great deal for themselves by helping someone, and get caught up in the helping part so much they overlook how terrible of investment it is and how much risk they are carrying.
Always make sure it is a win-win for both of you. A person in foreclosure already has nothing left to lose unfortunately, and you can't always help everyone. When you can help is when it can help you also, otherwise you are just putting yourself on the hook (win-lose), instead of taking them off the hook while making a good situation for yourself (win-win).