All Forum Posts by: Josh Mills

Quote from @Kevin Sobilo:

@Josh Mills, there is no guarantee that there is a deal to be made here but if you can get MORE information maybe you can figure that out.

You describe this as "pre-foreclosure". Is the owner behind on the mortgage? Was the property a primary residence? Is it currently occupied at all? What is the mortgage balance?

Sometimes you can estimate the mortgage balance by looking at when they purchased the property and for how much. If you have MLS access it will often have clues too like the type of financing. If you see FHA financing, then 3.5% down would be common for example.

Most mortgages are not assumable, but if the owner is distressed you could consider a "Subject-To" deal where they basically give you a deed and authority to manage the loan on their behalf. So, the loan stays in the sellers name but you have ownership of the property.

A short sale is another option where the lender knowing a foreclosure is imminent accepts the loss so the seller can sell for a price below what is owed on the mortgage.

Thanks for the response! The owner is behind on the mortgage and the bank told them they would foreclose on the property, the owner was able to negotiate with the bank to try to sell the property prior to foreclosing. Mortgage balance is 400k, owner occupied. The owner pasted away recently and left the property to their child who now occupies and owns the property. It was a primary for the prior owner as well. 

Hi all! 

Looking for creative ways to buy a pre-foreclosed property, the situation is below. 

The owner owes in the 400's on a property that is zoned 2 fam but they converted back to a 1 fam. Listing talks about the meticulous maintenance that was done on the property. Well after viewing the property it is in shambles to say the least. I would be surprised if 50% of the property is actually livable. The house is half painted half original siding, 3 bedrooms of the 4 are not livable and the stairs to the basement feel like they could collapse at any second. Bathrooms are old and outdated but functional. The asking price is priced as if the house was move in ready and the owner does not want to to entertain any offer below what is owed. Rough estimate to renovate is in the 175-225k range meaning that buying the property at the listing price would put you upside down very quickly. The owner has stated they just want to pay the bank and move on. 

The question is, is there a creative way to get the owner to sell it to me? Do I try to assume the mortgage? Any insight appreciated!

Thanks!

Hi All,

In NJ, speaking to an investor the other day who mentioned that states/federal governments will assist in buying properties that are going to be used for affordable housing. No minimum on the number of units. I have feverously been researching and have not found anything. Does anyone know of any programs or assistance from government. 

Thanks!

Quote from @Andrew Garcia:

Hi @Josh Mills, yes in short, you have it.

The easiest way to think of it is like a second mortgage. It is a fully-amortizing fixed-rate loan in a second-lien position behind your current mortgage.

You keep your current rate without needing to refinance at a higher rate.

The interest rate will be higher than on a cash-out refinance but since it is only on a portion of the loan, the blended rate is generally lower than a cash-out refi without needing to restart the amortization schedule.

Hope this helps! If you have any questions, feel free to ask.

Thanks for the response! Do I need to use the lender who did the first lien or can it be another? Can this be done on a commercial property, namely a self storage facility? 

Hi all! I was reading through some of the lending pages and came across a HELOAN. How does this work? Is it a second loan on the property, meaning do I keep my current mortgage and rate the same while taking on an additional loan on the property? Trying to see if this is another way to pull cash out and keep my low rate on my regular mortgage. 

Hi all,

Newer investor with 400k of equity across my portfolio. I locked in good interest rates during COVID and now do not want to refi. Was thinking of using a HELOC and business LOC (commercial property) to acquire properties cash and then refi those properties. Anyone have any insight into other ways to pull the equity out? Any warnings on using an LOC in this fashion? All insight and guidance is appreciated! TIA