All Forum Posts by: Chuck Shadle

Logan TWP NJ short sale opportunity?

I am not making any money on this but just trying to help some friends out.

Item: townhouse

Location: Logan Township , NJ (Becket)

Status: Current in its mortgage payments

Supposedly Appraised: $137K

Comps: ~$100K

Owed: $109K

Area rents ~$1300-$1500

The townhouse is a one story end unit with 3 bedrooms, 1 bath, living room, dining room, kitchen, family room and one car garage. Vinyl windows ~20 years old but appear in good condition. Roof is 10 years old in good condition. Vinyl siding is 5 years old in good condition. Home is a block from library, pool and elementary school and two blocks from shopping.

Laminate flooring has been installed in living room and dining room and has been purchased for family room. Baseboard is needed in living room and dining room. I was told fireplace chimney needs repair. Kitchen is outdate, not very large and doorways open on living room, dining room and family room I think that kitchen needs to be replaced and opened up onto one or two of the rooms. Bathroom too should be renovated and I believe that a second bath could could be squeezed between bedrooms 2 & 3. Bedroom floors have old carpet.

The real big issue is that there is an oil tank in ground. Pulling would be at least $3K but if there is a leak, it could be $65K to clean up (I know because that is what my parents had to pay to clean up their ~100 gal of oil that leaked). I do know that there was a NJ program to reimburse the pull and cleanup of oil tanks, but last I heard this could take 4-5 years.

The owner lost his job, couldn't find another for a very long time and when he did get another, it was for a lot less than what they had been making. With wife's disability this a single income home. He started pulling out IRA to make payments and ran through that. He cannot afford to live in NJ anymore and has found work and a rental in another state and is literally going to inform the bank and leave. He has not missed a payment yet, but it will now go into foreclosure.

I figured a short sale would be better than foreclosure on his credit. I thought I’d post to see if anyone would want to approach bank as even if they take it over, they will not get anyone to buy it close to the owed price with the issues I’ve mentioned above. That or if he was willing to consider a subject to. I won’t invest in NJ, and don't think I'd take this risk on so I’m out but willing to make the connection if someone thinks they can make something out of it. Oh, and I think he mentioned mortgage holder is a texas bank if that helps.

I have pictures if you want to see the home.

If interested, let me know and I will forward your contact details to owner.  Again, just trying to help out owner if that's possible.  

Agreed about getting it sold below FMV - thus my call to realtor tomorrow.

If realtor doesn't have any positive insights, I'll probably put it on the marketplace to see if there is any interest in Subject 2, etc.  I'd only be making introductions.

Average rents in area look to be 1500 but his mtg pmt is 1285 so not a very good deal to just rent it out when you have vacancies, expenses, etc.  and he wouldn't want to do that anyway....and there is always that oil tank.  

NJ does have grant money to remove and even cover leaking tanks but from what I see on Internet, they appear to be 4 years behind in reimbursements - so would help him any.

Looking for some advice here.

A person I know (Becket, Swedesboro, NJ area) lost a job 1-2 years ago and was out of work a pretty long time. He finally got another job but it pays considerably less than his first.

He was able to make his payments with his first job, but in his new job, he couldn't afford them and he started to pull money out of his 401K/IRA (was that a collective groan I heard?) and has kept them up to date (May was paid).

Now his savings has played out and he still can’t make payments (can’t afford mtg pmt and after no work for so long is really messed up financially). He told me that he was just walking away from the house and I wrongly assumed that he was just underwater (way underwater). However, I called him this evening and found out more information that changes my perspective.

He has 20% equity ($27,000) in his home based on a recent appraisal.

On the upside, he’s had siding and roof replaced in the last 10 years. On the downside, his HVAC is broken and he has an in-ground oil tank which would have to be pulled if he sells (were those bigger groans from NJ readers?). He doesn’t think it’s leaking but I know one NJ person whose above ground tank leaked and they had to pay $65,000...so I assume in-ground is similar….so it's one big risk even with 20% equity.

This guy has already committed to moving out of state. He’s just walking away from the mortgage. I don’t know the legal ramifications of that, but the credit ramifications are sure to be large. His mind is dead set based on his inability to live for one more month in NJ but with an offer elsewhere. I get it - he feels hopeless, but I’m trying to figure out how he can keep this from being a train wreck.

Tomorrow, I’m calling a realtor I know of from his neck of the woods, but I thought I’d post to see what your advice is. I don’t think I can change his mindset but maybe there are options for him to get rid of the house.

Thanks in advance,

Chuck

My first post aside from Intro, so hope this is the right place and would welcome any insights.

I have an Entrust SDIRA that I funded from a roll over of some stock I had from a previous company I’d worked for and had basically ignored until recently.

I have a person in FL that I (Lancaster County, PA) want to give a small 30K first position mortgage to. I am fully compliant with IRS SDIRA rules.

Entrust requires:

1. 1. Entrust’s Buy Direction Letter Form
2. 2. Promissory Note
3. 3. Deed of Trust/Mortgage
4. 4. Lender’s Title Report

OK, I can do #1, no sweat.

However, can I get #2 and #3 off of a company like Legal Zoom or do I need to get a FL lawyer involved?

Do I order #4 from a title agency? Is this something the buyer’s realtor would already have or will order? Etc.

Finally, do I have to have the mortgage recorded with the county or is this something a title agency does?

Note: I won’t go into specifics but my only concern here is for getting this legally accomplished and Entrust funds distributed.

I know I’ve a lot to learn but this is how I’m trying to learn and would welcome any advice, links elsewhere, etc.

Thanks,

Chuck

Hello everyone. I guess I’d be considered a stalker in any other context.

You see, my son turned me on to BP quite awhile ago and since that time, I’ve basically been addicted to it but never made the obligatory introduction or participated in the discussions (stealth mode).

And now, to my chagrin, I wanted to ask a few questions but figured I’d better introduce myself first.

I live in Lancaster County, PA. I’m an IT manager and have raised 6 kids (don’t gasp - had 3 of them the fun way and 3 by adoption – and we were a small family compared with my Amish neighbors). Now that they’re grown, I’m asking what I really want to do with my life :)

When I was first married, I did maintenance on the side for a man that had ~30 doors - saw the good, bad and ugly. I’ve also done some major renovations on our own properties.

I’m now looking to get my little toe wet with some notes via an SDIRA I’ve set up.  I'm then going to follow it up with some buy and hold properties.

Well, that’s about it. If you see me around, give a shout.

Chuck