Colorado Cabin Conumdrum

[Eddie Memphis]

A friend is about to lose a cabin that has been in his family since the late 60’s or early 70’s. It is on one acre less than an hour from Colorado Springs. Uphill.

The cabin is about 950 square feet, has electrical service, no well, no septic. The inside is not finished but it is insulated and vapor barriered, along with completed wiring. At one point is was ready for drywall, but now woodpeckers have blasted enough holes in the siding that all the insulation needs to come out to check for nests, bodies and all other denizens of the wild that may have found their way into the dwelling.

He told me it is going into foreclosure in September. I asked him for the numbers. He said he doesn’t know, ask his sister. I talked to her two days ago and she said they need fifty grand. Then she said they owe 42 but have three years of unpaid property taxes which amount to $1550 according to the assessor. She then told me how it’s the banks fault, they are too hard to deal with… blah blah. I have heard that since they started missing payments a few years ago.

Let’s say that the kids have never been… financially prudent. And they are in their 50’s now.

Enough about them. Let’s discuss me!

What is my best approach with the bank? I’d like to offer cash. Present an opportunity to save both of us money- US Bank doesn’t need to foreclose and I get to build a cabin.

Should I wait until foreclosure and try to steal it there? Um, I mean, attempt to save it? You know, for the family.

I know I should wait for the numbers, but I want to have the next steps planned out.

Thanks,

Eddie

P.S.

I know this post isn’t about maximizing return on an investment property. I have always wanted a cabin in the woods. So there.

[Travis Sperr]

if you are going to acquire before the foreclosure sale you are going to have to figure out a deal the current owners will take. If you are going to offer less than the owed amount you will need to negotiate with the owners and the bank. If you wait for the auction you will have to hope the property goes to auction at the amount the current owners owe plus any fees assuming the bank doesn't just take it back and go to market. 

A lot of moving parts - doesn't mean it isn't possible, just means there is some work to do. If  I had your shoes on I might look to see what cabins are selling for that are actually complete rather than buying this one and having to compete the repairs. If you have the cash you can approach from either angle. 

Good luck!