Becoming the "bank" for Pre-forclosure Homes

[Johnquel Jones]

I was wondering if there was someone who has insight into how you can essentially become the "bank" for Pre-forclosure homes?  How the  process works, what all is involved, and the pros and cons? Or, if you just want to partake in conversation before or after is fine as well. I am not above formalities where you can talk before you get to "business".

-Love and Respect 

[Bill Gulley]

Amber, LOL, like minded that haven't got a clue. Sorry to be so blunt, but no you can't charge a tenant interest financing a lease-purchase or whatever you want to call it without Dodd-Frank compliance and it won't be compliant.

Next, yes you could buy the note, the borrower needs to request the note be sold as an alternative to foreclosure, nothing says the bank will discount anything. Why not just buy the house and pay the bank off? You'll have better luck with smaller banks, the big ones have a machine like approach and selling a note clogs up their machine, so the borrower needs to ask and light that fire.  

The IRS won't nullify a sales contract, the courts can/will, the IRS simply treats it as a sale.

Special wording must be in an option to assure the IRS will not treat it as a sale under several tests. 

Best not to imagine what when dealing with financing matters, because you'll imagine wrong when dealing with tenant buyers. 

Thanks for the mention Brian, it's real estate folklore and financing voodoo on BP again! :)