PLEASE HELP...being foreclosed on because property is upside down

[Elaine Goepfert]

Jan 2023 I purchased a property in Cape Coral, FL. I purchased for $395,000 and rehabbed for $70,000. I took out a hard money loan with Kiavi for one year. I put up for sale with no bites then transitioned to a STR strategy then Kiavi told me they don't refinance unless it's a LTR so I found a renter and went to refinance. Right at a year I start the process of a refi and quickly find out that the renter wasn't paying high enough rent to cover Kiavi's requirements so I had to relist the property. I lost the renters due to them not wanting to cooperate for showings. Despite all of this I was still able to find another lender to refinance until the appraisal came in at $445,000 and everything fell apart. When I purchased the property one year earlier Kiavi gave it an ARV of $610,000! I did all the repairs per spec and under budget and was even able to add four palm trees to the front, a pool heater and fence in the backyard which should have made the value go up! However, the area has plummeted in value and I'm now upside down on this house. I've had it listed for months with one showing and one offer of $380,000.

I have never missed a payment but Kiavi will not negotiate their terms and insist on foreclosure and they just informed me they are moving forward with the foreclosure.  I put in $50,000 of my own money not to mention months away from my three kids while working on the home.  I'm proud of the house I created, it's beautiful & I even have a 5.0 rating on Airbnb.  I honestly feel like I've done everything right and am completely stuck.  I'm devastated and if anyone has any words of wisdom here I would just SO APRRECIATE any help/advice I can get.  I just don't know what else I can possibly do.

[Minna Reid]

Quote from @Elaine Goepfert:

I've begged several times for them to please just refinance me.  I never missed a single payment and they made $50,000 in interest off of me over the last year so instead of foreclosing on me recking my credit for the next 7 years and them being forced to sell a house for less than what I still owe, it seems like a great win-win option but I was shot down over and over because the appraisal was just too low.  

I did ask about short sale and they said they would need to see a HUD statement and purchase agreement to do that but I was confused how I would generate those two items without an agreement from Kiavi on the short sale amount? I could only agree to the purchase price if I knew that Kiavi would accept the short sale but Kiavi won't entertain doing a short sale without a purchase agreement. I've gone in circles on this. That's why I'm reaching out, I just don't understand how I can be so stuck??? I feel like I'm missing something. How can I put $50,000 and pay another $50,000 in interest and still be foreclosed on in one year? It's a nightmare.

 They cant approve your short sale because there is no sale to approve. Find yourself a real estate agent that understands short sales ASAP, list the house at a price it will sell, find a buyer and go under contract subject to the short sale approval. Then approach your lender with the short sale.  You are going to need help as you do not know what you are doing. An experienced short sale agent near you can handle all this for you.Find one today.  Feel free to PM if you need help finding one.