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Charles Robinson
  • Iuka, MS
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Probate and Pre-Foreclosure Deal?

Charles Robinson
  • Iuka, MS
Posted May 24 2015, 06:43

I have a pre-probate and pre-foreclosure deal on the table that goes like this and I need help getting my arms around the acquisition using seller financing.  I have kept the math easy: 

$125K ARV;

$25K repairs to get up to date;

$20K lien; this lien is 6 months behind payments of $722/month;

Parents died and house was left to recently divorced daughter (only 1 heir) who currently lives there and wants out and wants move-out money to a townhouse paid for by the government (Section 8) - to start over. There is no PR or executor yet and probate has not started (Pre-Probate).  Attorney wants $2000 for probate of which daughter could not do.  Bank moved the ball forward and tried a Foreclosure Trustee Sale to "force" a short sale with no takers on foreclosure price...

I have a gentleman's agreement with single heir (who is not executor and cannot sign contract since she does not own it yet - pre-probate).  But I would like to get under contract with seller financing for $60K, no interest, no payments, ASAP, tomorrow, and then until I get it re-sold and cashed out down the road.  I would plan to deal with the fiduciary catch-up issues.  Heir would net $40K at the end, with offering potential discount also at cash-out time or the end.

If I don't want to deal with a potentially flaky seller as pressure is relieved and I want control, and seller is willing, is it best to set it up at the beginning that I just become executor and deal with all this?

But would I be the buyer and seller in this case? Me and my LLC?

Or would it be better for marketable title issues to let her become executor (as only heir) but then I lose control and have all these costs out for loan mod, catch-up, and probate settling, attorney costs, paying taxes, mowing, you name it - that she has no capacity to do?

Thoughts on how I can do the paperwork to get the deal done with the heir (current non-owner) with good terms and owner financing?

Thanks for any pre-probate, pre-foreclosure advice, expertise. 

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