Question on non-performing notes and foreclosure.

[Connie Stainbrook]

I have a couple of questions on the topic of non-performing notes. I have read that if I own a note that is not performing and I have foreclosed on the property. That I now have a choice to keep the property in my inventory and then I read that if you sell it in a foreclosure auction that any cash collected above unpaid balance, fees, etc. Goes back to the borrower. So that would lead me to think I would be forced by law to try to sell the property incase the owner is due some $$ for equity. Can someone clarify this point for me. Once the house has been foreclosed on can I just keep the house and not sell it? If I do decide to sell it do I have to give the borrow any extra cash made above my costs? 2nd question is if I buy a loan that has been non-performing for lets say 2 years. I buy the note at 60% of the UPB. Can I then still charge the borrower for the 2years of back interest and penalties? I noticed some notes were actually being sold for more then the UPB but the property has a ton of equity so my guess is that I can in turn charge the owner for back fees and interest even though I just bought the note.

I appreciate your feedback.