All Forum Posts by: Jeff Bowman

I live in a nonjudicial foreclosure state. I own a nonperforming note. My last option is to foreclose then auction the property on the courthouse steps. I would rather make an arrangement with the debtor. The problem is that I would have to finance a loan to him (renegotiate the original terms) or take a deed in lieu. I prefer the latter option.

I'd be curious to hear what other more experience note investors have pursued in the past.

Thanks!

Jim,

Sorry for the delay in getting back to you.  Thank you for the advice.  One question: how do you figure the last ten year has a NPV of zero?  Principal only payments?

I have an issue that I would like to ask other forum members about:

basic situation: my father has health issues and has been placed into senior citizens home/assisted living. We're needing to liquidate current real estate assets in order to pay off debt and rid ourselves of this townhome (HOA covenants prohibit from being rented to a tenant).

There is a secured line of credit against a second residence my father took out several years ago that is fully invested in multifamily notes. Security on the notes is good but they cannot be pledged or sold for other collateral. The townhome is owned free and clear but purchased in 2006 at the top of the market. I have been tasked with getting this townhome on the market and selling it for a 'good price". Agent thinks target number is doable but on the high side.

My question is this: the only thing that really needs to get paid down is the line of credit which amortizes in November at LIBOR +1. It's not a crisis situation since their budget can handle the amortization but it would be better to pay down the LOC and have some extra liquidity to rollover into SFR eventually.

Last time the house was put on market it did not sell. Since it is owned free and clear, I'm trying to think of ways to do owner financing and encourage buyers to purchase on a seller carry back deal. In an ideal world, we would receive the amount needed to pay down the LOC and then finance the remainder of the purchase price at an attractive interest rate for all parties and have a note for the remainder.

As I said before, the problem is that any purchaser of the townhome will have to use it as a residence/owner occupancy since there is no subleasing in the townhome community. I've experience in buying/selling rentals but don't have any experience with selling non-investment property to an owner occupant. I'm going to use a realtor to show the house but would like to be involved in a kitchen table negotiation to try and see if I can get a buyer interested with some sort of owner financing if the purchase price is too high and there are no buyers.

Any thoughts on how to structure this deal or am I making it too complicated?

Mike: I certainly agree with keeping on good terms with the neighbors. However, as is my understanding, it is the new buyer who is being overly aggressive in the situation in terms of stipulating that this encroachment agreement is no longer valid. He seems to be trying to bull his way through the situation and force my folks to move the tank based on his interpretations of the legal technicalities rather than trying to negotiate. I am only tangentially involved in this but a lot of these things tend to fall on my plate eventually. I'm trying to figure out how airtight the encroachment agreement is just in case it does get to the lawyer level.

Adam: I am of the same opinion.

Guy: thanks for your reply. Yes, I understand the need for attorneys in this situation but since attorneys do charge by the hour, I would rather rely on any advice I can glean for free for the first part. At any rate, we are in the first stage of the process and don't need to do anything until one of the parties escalates the situation.

Adam: thanks for your reply. I am assuming the buyer found the encroachment agreement via his title company or the seller revealed it to them. The encroachment agreement has nothing specific to a change in ownership but as I said before the subparagraph "binding effect, recordation" states the following:

"it is agreed by record owner, her heirs, successors and assigns here to this agreement will be recorded in the office of the blank County North Carolina register of deeds. This agreement shall be a covenant running with the land and be binding upon the parties hereto, their heirs, personal representatives, grantees, assigns and successors in interest."

This says to me the encroachment agreement will continue along with new ownership but undoubtedly guy above is correct that lawyers will have to be involved.

Hi all,

my parents own a mountain home in North Carolina. Several years ago when a new survey was done on their property and the property next door, it was revealed that my parents propane gas tank (which was already in place when my parents bought the property) and part of the walkway (ditto) is encroaching upon the neighboring lot. An Encroachment agreement was drawn up between my parents and the owners of the lot next door and recorded in the county were the two properties are located. Now the people who own the lot next door are selling their property to some buyers who want to develop a mountain home and they've requested that the propane tank be moved. Current owner of the lot is offering to pay for moving the tank but not the landscaping (it would make a mess to move the tank). All things being equal, my parents would prefer that the encroachment agreement continues with the new buyers.

My question is: is this encroachment agreement only valid with the current owner? In one of the covenants, there is a subparagraph that attests that this agreement has a binding effect upon the property and continues regardless of new purchasers, successors etc. However, this new buyer is threatening to get attorneys involved because he seems to think that this is not a encroachment granted in perpetuity.

I think my folks are in the clear on this due to the nature of the language in the agreement but the last thing I want to have happen is get lawyers involved and have them have to pay to move the tank since, technically speaking, they are in the wrong.

Don't have any experience/advice in this matter?

Thanks