Interesting request...is it possible or even legal?
I just got off the phone with a seller who made an interesting request after discussing what he'd like to get out of his property, and am curious if what he is asking is possible or even legal? I've never heard of anything like it before.
Quick back story on this is that the property is going into foreclosure due to his wife (now ex) developing a serious heroin problem over the past 2 years and blowing all of their money/not paying bills. Right now he owes about $90k on his property, and has $30k in personal loans from his sister. He is hoping to get $130k from the sale. He wants the paperwork to be drawn up in a way that would show only $100k from the sale going to him and the other $30k going to his sister to pay off the loan. I have a feeling that this is just a way to hide the additional money that he is hoping to get from his ex-wife so that she can't try to get a cut out of it. I am planning on asking to see actual documentation of this $30k owed to his sister when I go to look at the property this weekend. If he is able to provide legal documentation (i.e. notarized note, drawn up by a lawyer, or whatever documentation he may be able to show), is there a way that the money above and beyond what is owed on the mortgage can go directly towards paying off the debt, or does it have to go to the seller first, and then paid out by him to his other debts?