All Forum Posts by: Heather D.

Hi Isaiah -

I did just that! But the homeowner won't return any phone calls at this point... so it may be a lost cause. But as a result of referring it to a realtor for a short sale I have the realtor sitting down with me to walk through the basics of a short sale so I can be prepared when I come across my next one. Always loving learning more to add to my toolkit!

As for owner finance... I'm not at educated enough on it... I know the high level but not enough to know where the regulatory pitfalls are.

Btw... I walked the property today... WAY more than paint and carpet. The house has been neglected for years and was in a dire state. It would need 40K+ to just make it ready to rent out. And the owner owes much more than it's worth -- he pulled money out on a home equity line... and then just decided he'd hurt his ex-wife by stopping payments on the mortgage 6 months ago. The only ones I felt bad for in the situation were the kids. They should not have to live in that filth... nor be at the mercy of those parents.

The owner financing deals are targeted to buyers that cannot get an FHA loan... or any mortgage in today's market. But I hear what you're saying Joel about the risk...

I need to confirm but I think the 118K is the balance and so the missed payments would already be included in that total...

I thought about a sub-to for myself... but I don't have the cash to reinstate the loan or make the repairs. With so many expecting at least 200/mo in cash flow on rentals now I don't know if these numbers would be attractive to another investor even if on a sub-to...

My last resort is to pass the lead to another local investor if they think they can make something of it... and then ask them to show me how they worked it in return for the lead...

My understanding is that the investor/broker collects a deposit/down payment from the buyer and uses that to reinstate the loan, make necessary repairs, cover assignment fee, etc and that the loan is not assumed by the buyer but stays in the sellers name is "assigned" to the buyer.

Thanks Joel. You confirmed what I suspected... but I wanted to make sure. I don't know how close this guy is to having it go to auction so I'm not sure of the time constraints... and if a broker could move it fast enough.

I don't have the interest rate yet... and no, the owner hasn't requested a payoff amount ...and it is owner-occupied.

I know a number of investors that broker owner financing deals. If there's not enough equity in a deal they find a buyer who can't get traditional financing and put the two together - doing a mortgage assignment from the seller to the buyer. I was thinking about turning the lead over to one of them. I'd rather someone be able to do something with this and save this guy from foreclosure than let it go through.

I just started my first marketing campaign this month. Used the yellow letter and sent it to a 60 - 90 days late list. A call came in yesterday from someone that that got the letter and just wants to have their loan paid off and get an extra $1,500 to move on. I'm looking at the house tomorrow afternoon but this is my FIRST one.... so I need some help.

The mortgage balance is 118K and the early sold comps show $144K (need more diligence to prove this)....and my early rental comps show $1,400/mo. AND the owner is behind 6 mos in payments. I expect at least 5K in repairs. At this point I only know that it needs carpet and paint. My contractor is going with me tomorrow to walk the property and identify all required repairs -- focusing on those need for a rental since I don't see any hope for a flip.

I've been planning to use the 70% of ARV less repairs.. and based on that formula this isn't even a mediocre deal.

Is there anything salvageable here? I really don't want to get into the owner finance game and I don't want the deal for my rental portfolio... should I try to get it under option and market it to some of my buyers who are looking for rentals?

If the numbers prove out like I've detailed above... what would YOU do?

I appreciate your guidance.

Heather

God bless you! Thanks so much!

Hi All,

I'm starting a direct mail campaign to preforeclosures but I'm not comfortable using the standard "I want to $buy$ your house" verbiage in the yellow letter. I've done it... and would rather deal with someone who knows what I'm about rather than trying to sell to them on the call. I realize that this will mean less calls... but I also expect that the calls I do receive will be better qualified leads.

Does anyone use a yellow letter with something other than standard verbiage above and disclose that you're an investor?

If so, are you finding much success?

I've read articles on other sites about disclosing this information but I don't know if they were successful.

Thanks,
Heather

Well that's not good... they're going the wrong direction if they're at 15% for NOO! :)

FNMA/Homepath requires only 10% down. The best govt loan program for investors is for VA foreclosures. But you have to get qualified through BOA before you can even put an offer in on a home.

VA terms for investors - 5% down, no MI, no appraisal fees, 3.5% fixed for 30 years and often 3% seller concessions on closing costs if requested. Check out va.equator.com for properties in your area.