Success stores for inspiration please!

[Hannah Joy]

Hey I'd love to hear a synapsis on a pre-foreclosure or foreclosure that worked out! What were the numbers, how did the deal come about, what came up that was unexpected, and what was the payout? Looking for inspiration and a sense of the types of situations that work out in the end. Thanks! 

[Marty Boardman]

Here's a pre-foreclosure deal I closed two weeks ago (Arizona)...

Seller slipped into foreclosure in 2021 - did a loan modification with his lender (big mistake). His monthly payment jumped from $1,300 per month to $2,100. He couldn't make this payment so lender set a new auction date for 1/4.

I gave the seller 10K cash at closing (plus 90 days to move out), reinstated his loan (42K) and took title subject-to. The seller will get another 20K when he is moved out.

My all-in with the underlying loan is 275K - house value is 400K. It was built in 2012 so not much work needed, mostly cosmetic (paint and carpet). I should clear about 85K in profit.

The alternative for the seller was losing the house at auction, a nasty foreclosure on his credit report, receiving NO cash and getting thrown out by the county constable within 2-3 weeks.