All Forum Posts by: Jennifer Irwin

It's been a long process on this house, but we have finally made it to liquidations.    No probate was needed, just affidavits of heirship and determinations of heirship.   All "kids" have signed off, and yes, a realtor was brought in to complete final paperwork.   The bank requested a listing agent be brought on board, and even agreed to having the listing and buying agent be the same person.   He listed for less than contractual balance due (as per heirs request) and we put an "best offer" at the same.   (yes it will be a short sale)   We have had an appraisal done, for "for our eyes only".   The bank has never requested one.    The offer was put in last week with a 30 day closing date.   And so far, all is in motion....

I'll update as we get more info.   

Well a little update, YES the bank agreed to a short sale on the property AND they agreed that the NUMBER that the short sale will be based upon IS the "contractual balance due"on the date that the last signee died!!    

The whole process has been held up as a year prior to both signees death, a bankruptcy was filed and was terminated about 6 months after "she" died.   The courts didn't even have record of her passing, and terminated based on "lack of payments made".

I spent a little time, logging in, registering and downloading bankruptcy docs online and we sent over to the bank, the termination of bankruptcy.  

The bank has pre-approved a short sale offer, but the heirs must first go though probate.   There is no one contesting and the affidavits of heirship have already been filed.   The minute probate is complete, an offer is being submitted, and closing can be done immediately.   

Some of these articles are a little outdated...

http://homeguides.sfgate.com/basic-foreclosure-fee....

and another

https://www.trulia.com/voices/Foreclosure/How_much...

and another

http://www.mortgagenewsdaily.com/622008_Foreclosur...

But my figure of $20,000 to foreclose, came from a number of articles similar to these.  There are legal fees, realtor fee, auction fees, maintenance fees, and the list goes on.  

ALL of the banks use trustee for the foreclosure process and it's hired out, which can be expensive for the banks.   

I appreciate your input...

So an update, which I feel pretty darned good with!!   The "file" has moved to an actual person who can make a decision, and yes, it IS considered a "short sale".  I found an online "short sale" offer form and I (and the heirs) came up with an offer and presented it last week.    The end of this week, we will find out if the bank is "open to a short sale" offer.  I think they call it a "pre-approval for short sale"    

The bank also wants to get a "professional" to appraise with consideration to the as-is condition of the property, and will even allow "us" to hire who we want.    So I have an appraiser who will meet me at the property and come up with a value.   The bank is more concerned that the value is "less than" the contractual debt balance.  

The big issue here is the "contractual balance due"  (amount due after both owners had died) or if we are working off the "past due balance"  (balance has doubled since nothing has been paid in the past 7 years!  Considering that the house has been vacant and basically "lost" by the bank.  The only reason the property is back on the bank's radar, is that WE called and started asking questions about it!! 

So that's the latest update......

What I have read and understood, was that a foreclosure process costs the bank approximately $20K in legal fees.   There would also be an additional legal expense in filing paperwork and getting a judge to release the bankruptcy prior to a foreclosure process. 

There has been an update as well.   After 3 months of filing affidavits, and getting all the legal heirship information corrected, and to WF.   The "heirs" contacted WF Probate and Preservation department and stated they wanted to offer a settlement / short sale on the property.   

They have now been referred to a new department where a fax can be sent and photos can be faxed over as well.   Apparently "this" department has executives that can actually make a decision regarding the sale of the property.  

First of all, I had never heard of a "zombie foreclosure" until I started researching.   I have found a vacant house in my parents neighborhood which I am very interested in purchasing as a home for myself.   Both as an investment, but more so, so I can keep an eye on my parents.  

Back in Sept, my dad and I walked the property and looked into the windows and the house is fully trashed.   (piles and piles of garbage).   I called the phone  # that were listed on the notifications and discovered it's a property "financed" by Wells Fargo.  

After researching the title (downtown) and researching the previous occupants, I discovered the residents died 6 years ago.  

I, researched and tracked down the "heirs" and they were unaware that the property was still just sitting, 6 years later.    After much conversation, 2 of the "kids" (grown adults...police officer and nurse) made a trip up to San Antonio and met me at the property.  Ironically the police officer was able to access the property.   

So "mom and dad" died, there was no will, met with an attorney and 6 years ago, house was "under water" and over $10K due in back loan amounts.    Kids told WF to foreclose.   WF started process but never finished foreclosure.    

So forward to today, house is still sitting vacant, full of trash and becoming more and more delipidated each year.   

I am a cash buyer, as it IS unfinanceable.  The kids have filed for "affidavits of heirship" so that the conversation can begin with WF.   

WF has said:   House is in the possession of the homeowner.   They do not maintain it.  (however they have been paying property taxes for the past 6 years).   They have not foreclosed on it, nor can they foreclose, as there was a bankruptcy that must be released first.  Articles of Administration were filed 5 years ago, and everything is pending, and deadlines have passed to complete process.   In Texas A of A must be completed in 4 years.    

There are currently 2 small liens on the property from the City of San Antonio for a vacant property and from the HOA.

So with all that said, WF has stated that the "contractual balance due" is $79K but (with fees and such, since there has NOT been a payment on the house) the "past due balance" is $141k.    

The county appraisal is $155K, but this house has no appliances, needs a new roof, needs painting, cleaning....all said and done, there is a $25K rehab to get this house livable.   

WF has NOT foreclosed on the property due to (a) a bankruptcy and (b) although they do not want to admit it, they "lost" the property.   

The heirs are trying to negotiate a "settlement", keeping in mind the house was purchased for $89K in 1998 and $130K of payments have been made (ie WF has not lost money on the deal).

According to my research and the local Rex Report, this house should sell at auction in the $70K range.   And that is a last resort option for the bank.

I have understood that a foreclosure, esp with a bankruptcy release is a $20K expense for a bank.  Plus I know there are costs incurred even to sell a house at auction.   

Does anyone have any advice in the negotiating process with WF PRIOR to them (a) filing for release of bankruptcy and (b) foreclosure.   I would think they would be willing TO negotiate and get this house off their bad asset list, rather than continue to lose money and invest in a whole bunch of legal fees in order to sell at auction.