Need buyer, Desperate seller with over 200k equity, foreclosure!

any fast buyers or suggestions?

Try to find a hard money lender. But the only thing is they want you to have some skin in the game.

Christopher,

If the numbers are right, you may have a potential deal on your hands. However keep in mind that Zillow is nothing more than a guestimate, at BEST.

I would be leery of selling it back to him under any circumstances. Most investors I know would want to buy it; have him move out prior to buying it or stopping the foreclosure, and then selling it to a landlord or rehabber.

You will probably run into all kinds of issues with buying it and letting him continue to live there (rent free??) for a couple of months and then selling it back to him. If you are going to buy it, have him move out before hand; just my opinion.

--Walter

"If it is to be, it is up to me". -Anon

The foreclosure is going friday, they said we need to have money to the bank by Thursday

Yes, hard money can close the next day; they (Hard Money) have the liquid cash on hand to close the deal *IF* the numbers work. They are also an excellent set of second eyes to look at a potential deal for you, to let you (the borrower) know if you have a deal or not (i.e. they won't lend the money if it isn't a deal).

--Walter

"If it is to be, it is up to me". -Unknown

to buy it and sell it back to hime for profit. The powers that be would frown upon that. They consider that being a predator. What would it look like in court? The big bad investor taking advantage of a person under duress. If you want to help him, find a way to get him caught up, have him sign a promissory note or contract, paying you back with interest for the 25k. Unless he is willing to sell to you, but then he has to move out. Hope you find a way to help him, too bad his sale of business didn't come through sooner.

Thing is he has terrible credit, 477 and I would only want to secure the note against his house. If I made an offer for 110k on the house, at least he would take home 10k.. bank is going to give him nothing, and put a foreclosure on his credit.

Kinda funny how I am the bad guy in that situation, but I do understand what you are saying here. Thank you for responding!

Maybe I can get my first deal done after all! never thought it would be in West Virginia! And here I have been looking only in my backyard in southern california.

Dang my credit isn't going to pass this one I don't think, 640 needed on one website i found

Hey Christopher,
if that person is capable to pay his house off thirty days from now, and still yet the bank is not willing to work with him, he must have done something really bad to them. Did you personally verify all the numbers?
If everything is true and the bank still will not work with him, it can't be very hard to find the money he needs. He needs a loan for one month, that means even the craziest interest rate is way better than the alternative. Let's use 50% interest to look at this scenario. 50% adds up to $ 12'500.-- a year which equals $ 1042.-- a month. That is not a bad price to save a house.
You think it is very hard to find a loan if you offer 50% interest. Get on Craigslist.
Good luck!
Thomas

The bank would give him as much time as he needed if he was under water, but they know if they put it up on auction they will sell for more than he owes.

I don't think that the sale from his building is completely secured.. his credit stinks because of student loans, and collections and now the house.. I have seen his credit report, and the bank statements from his business.

I probably could look up an investor on craigslist, but it is the secured side of this equation that I am having trouble with. How can I secure the note against the property that I want to purchase? (I have no idea) I guess I need to speak to a lawyer in WV

I can purchase this house for 125k. If the arv is a 100k less than his appraisal he got last year at 360k,(360k-100k) 260K would be a steal. I would like to give him the opportunity to purchase it first, if the building he has doesn't sell we would put on the market.

Hey Christopher,
I was thinking more along the line of him saving his house, him finding a private lender on craigslist. No matter what you do later, at least the house is saved. In case his building doesn't sell, you will have time to come up with a way to structure a deal.
Just a different angle to look at it.
Thomas

Christopher,

I'm not sure what Hard Money sources you are looking at, but the Hard Money lenders I deal with at my local REIA (SE Texas) don't care about my credit score. They look at the deal; in particular at the numbers (ARV, purchase price, repairs, exit strategy, comps, etc.) and make a decision to lend or not to lend solely based upon the numbers. (Notice I did not include Tax assessed value in my numbers; no one cares what the county taxes a given property for and it is not a reflection of a property's value).

In a worst case scenario, a Hard Money Lender is going to say 'if I lend the money and everything goes South and I end up having to foreclose on the loan, am I going to be able to get my money back, how soon, how difficult, and how much will I profit if I have to foreclose and take the property back'. That is it in a nutshell. So *IF* your numbers are accurate, and they had better be, then you do not have to worry about your credit score or that of the current homeowner. The Hard Money Lender will run his own numbers and verify yours against his, BEFORE he funds the transaction. If the numbers don't add up, he will not fund the transaction; simple as that.

I'm going to suggest (again) that you look into the legalities of selling the house back to the current owner, who is about to lose it to the bank. I cannot remember exactly where or under what circumstances, but I know that there are some legal restrictions with this type of scenario (possibly) in certain circumstances. In fact Christopher, I think some states have specific legislation against what you are trying to do, because there have been misunderstandings about whether you actually bought the house or just became a mortgage lender to the current homeowner and now you have to try to collect monthly payments from him. BE VERY VERY CAREFUL HERE, YOU ARE ON THIN ICE (so to speak).

IMHO, *IF* you get this property under contract you are much better off taking possession and finding your own end-user buyer of the property than to try to do some charity work and save this man's home for him and his family. I am all about supporting charity, but not taking on or making an individual my personal charity.

Let's say for example he needs a down payment to rent another place (assuming you get the house). Then *AFTER* he vacates the property, all of his possessions are in a moving truck in the driveway, and he hands you the keys to the house while you are both standing there and you have walked through and everything is fine (no damage on the way out and not leaving garbage or possessions behind), then you can give him some cash money (if you want) that he can use as a down payment to move into a rent house or an apartment. Just NEVER give him the money BEFORE he and all his possessions vacates the current house that you now own.

Just my opinion.

--Walter

"If it is to be, it is up to me". -Unknown

I'd check for other liens before doing anything else. If he was behind on mortgage, could also be behind to IRS. Letting the bank foreclose should release IRS debt (I believe?)
Just something else to think about....

Andy Sager
DG's AndyS
CFIC member

Thank You Walter, Andy, Thomas and others for viewing and commentating.
I appreciate the information and outside perspective.

Will keep you posted...

Guess all we can do is make an offer. The attorney said that i should do a title search to check for liens on the property.. would that show up on his credit? I have the credit report right in front of me and i see one lien for 1500 bucks but that is it.

I would definitely verify all the numbers to make sure they are accurate. And, I would look for a private lender through craigslist.

Also, if you have a local REIA (Real Estate Investment Association) then you may be able to find a private lender or hard money lender through them.

I have to agree with not worrying so much about the charity aspect. The only thing it will do is kill what little time you have. Jump on craigslist, biggerpockets.com, deangraziosi.com, and every site you can locate and present something to the following;

3-6 month loan needed for 150k. (120k to owner - takes care of charity)(15k to lender - first bonus)(15k to you). List for sale at 175k with seller financing. (sell for 165k cash - pay off 150k loan with 2nd bonus of 10k) (you accept a note of 10k for seller financing - your second bonus).

Naturally, if you had more time, I would make it more beneficially to you, but hey.

Even if I can get an investor, or hard money.. how do I stop the foreclosure in three days? crazy first deal.. it may just be slightly over my head. I am still fighting for it though!

amazing house:

4/3.5 sold in 1993 for 213k
2500 sqft w garage and 1 acre lot

all houses around it are worth 315k+

I spoke to an attorney and he said there are no laws stating that I can't re-sell this person his home after 60days. I can get this for dirt cheap.

how do i stop foreclosure to buy more time?

great idea, i am reading the book "Go Giver" and I am trying to give more. That is the reason I fighting for him. Thank you soo much.

Find the money you need to by the house (private investors, hard money lenders, cash buyers, etc). These people usually have cash available, and can move within 24 hours. Then follow one of the strategies listed by the members above.

Option 2:

Bird-Dog it. Call every "We Buy Houses" ad that you can find. Ask them, how much of a referral fee they offer for a good lead. You can get anywhere from $200 - $2000 on average. It's not as much money as doing the deal totally yourself, but something is better than nothing.

How would I secure the 3-6mo loan?

owner is looking for a new propperty today.. He is pretty sure he is going to lose this to foreclosure.

One question: do I have an attorney write up the sales contract, or just a realtor. I know realtors will work for free, but i donno about the attorney.
I just called the asset manager to see if we can extend.. left a message though.

I like the 3-6mo loan idea,I just don't know how to structure the loan so that the partner has secured interest in the home. I suppose I can just take on a finacial partner and sign both names on the sales agreement.

I still have faith getting this done, but I have one less day now. Thanks again for all your support and suggestions.

I remember a story about a deal Dean talked about in his BARMN book where he bought a non-performing note from a Lender (i.e. the Bank) at a substantial discount (because the note was non-performing), and then instead of having to foreclose, Dean was able to work something out where he paid the owner a small fee (I think) and the owner just signed the Deed over to Dean and walked away. Dean's buying the non-performing note from the Lender stopped the foreclosure process; not sure if you have the time to do this between now and the end of the week.

Good luck.

--Walter

'If it is to be, it is up to me' -Unknown

It is sad that this house owner has a credit report of 477 and is about to loose his home. I feel sorry for this person, but putting him back in a home evualuated at 360K is not going to change his method of handling business. According to Honest Abe and my understanding:This person will find another way to loose this same house and will not be any better off in the future. If the house owner truely has 198K coming from another deal, he can buy another house with cash and start helping his credit. If he does not truelly have 198K coming, he at least has 10K clear and no foreclosure to bring his credit down even further.Also if you do the deal you do not have to deal with him and unforetold sad stories in the future.

[quote=If he does not truelly have 198K coming, he at least has 10K clear and no foreclosure to bring his credit down even further.Also if you do the deal you do not have to deal with him and unforetold sad stories in the future.