How to find out how much is owed on the mortgage

18 Replies

There is a short sale I am interested in Colorado. Does anyone know how to find out how much someone owes on their mortgage? This property is in Douglas County, will I be able to find this out on the county website? 

In a short sale, how much is owed is irrelevant. The bank will base their approved price off of FMV, with no relation to the loan balance.

There is only 1 way to know exactly how much is owed on a loan.

Get the seller to authorize their lender to share the information with you.

The only other option would be to see how much the loan was recorded for during the purchase. Check that there are no secondary liens. And then work backwards as best you can based on what you think the terms of the mortgage are.

I think some counties allow you to see the recorded mortgage. If so, you can figure out from there pretty easily.  i.e If initial loan amount on March 1, 2010 was for 100k and their terms were a 30 yr mortgage at 4.5%, you can tell what the payments are and what the amortization schedule would look like to see how much of the principal has been paid off by now.

What you can't tell though is how many payments behind they are, late fees, penalties, etc.

Thats why I would say the only real way to get that number is to get the seller to authorize the lender to share their loan information with you.

As Wayne said, it is completely irrelevant.

It might be irrelevant where you guys are but its been helpful for me.  I go to the local county courthouse website and search public records.  Foreclosures are essentially lawsuits and in my state you can look up most documentation related to these lawsuits including the mortgage amount, interest, and fees they are suing for.

In several cases identifying the outstanding loan balance has helped me acquire homes by putting in an offer in for slightly higher than their lawsuit, however if the short sale is efficient they might be wise to realize that they have more equity and can sell it for more.  Regardless, its a good starting point for offers on homes for me.

@Callum K.  If you're offering more than they owe, it's not a short sale. 

Checking liens filed only gets you in the ball park, you might see that they are underwater.

To know if you do have a short sale, get a payoff request to the lender, usually the owner/borrower can obtain this on the phone. Have them call and ask for a payoff as of a certain date in the near future, where you might close AND ask for the per diem rate, that is interest charged per day beyond that closing date until the next payment date.

After you have the payoff, you'll know what amount you need to clear in your transaction, if the property is worth less, you then have a short sale. At that point, knowing the amount owing lets you know what the lender is discounting.

If the borrower qualifies for a SS, the payoff is rather irrelevant as discounts are treated differently for a lender as to their actual loss, you won't figure that out as a buyer.

OTH, the payoff is a bit of intelligence that may lead you to an offer, especially if there are other liens involved, a senior lien holder will be squeezing junior lien holders to reduce amounts needed to give clear title, you can see how the game may be played out.

Agents or others who specialize in SS become familiar with what a certain lender may accept and what the may demand of junior lien holders, knowing the payoff sets a base line to arrive at where you may end up as an accepted offer. Being too far off may make the lender to take another approach as to marketing time of the property or further valuations. I'd rather have the lender eat part of the pie and get a good deal than trying to make them eat more of the pie trying to get a steal of a deal that may not fly at all.

While the payoff can be rather irrelevant on a buyers side, all loan information can be useful. :) 

We always try to get a guesstimate on 'what's owed' but as the posts indicate it's moot

We do our own FMV assessment, take off 25-30% depending on repairs & make the offer.

(But if we really want it we have gone in higher than asking.)

The best one was a $58k (owed) foreclosure that sat for 5 years, we finally got it for $21k after many offers fell through because of financing issues. Plus the had bank paid a years taxes in advance which were not credited on the close. 

Try I'm a happy customer and I would recommend it to anyone for researching everything about a property. Its Premium Report has mortgage balance, lender, terms, dates etc, with all the title history and other lien information. 

Originally posted by @Jason Woods :

Try I'm a happy customer and I would recommend it to anyone for researching everything about a property. Its Premium Report has mortgage balance, lender, terms, dates etc, with all the title history and other lien information. 

 You may get mortgage balance, lender, terms, dates, etc. but only from the point of recording...if it was recorded. You're only going to get publicly recorded information. You are not going to get a borrower's payment history or unpaid principle balance at any snapshot in time so, you aren't going to get the actual true balance. You would only get an estimate, based on a LOT of assumptions.

IF the borrower took out a 30 fixed rate loan at 4% on January 1, 2014, you could capture that data and run an am schedule to guess how much he/she would owe today. Maybe you'd be close but what if the borrower had an ARM and the rate went up? What if the borrower had an impound account and ran negative escrows for years on end? What if the borrower never went 30 days delinquent but paid after the grace period for five years? What if the borrower got a forbearance and capitalized delinquent interest? What if the borrower had a private 2nd? What if the borrower stopped paying? What if the borrower didn't stop paying but made partial payments? What is the originating lender sold the loan on the secondary market right after closing (7 out of 10 deals in the country are sold on the secondary market)? What if the borrower was in a loan modification that wasn't recorded?

...None of that is going to show up in any list anyone sells you. The only list that contains that information is a credit report and those are not for sale to anyone subscribing to any service. At least, not legally.

Maybe the borrower files bankruptcy, and maybe the lender files a proof of claim, and maybe you have access to PACER and maybe you pay for that access and get a copy of the bankruptcy filing. Still, you are only going to know balance at a snapshot in time. The only way you would find other terms is if they filed the note with the BK court.

Ron, you're absolutely right it's very hard to find out the exact outstanding balance of mortgage. I can only say the report from gives the best information I can find, usually with origination balance, date, terms etc you can get a pretty good idea of the remaining balance. 

All the other risks you listed are also true, it's one important source for research, certainly it shouldn't be the only source. 

In NY we have a public system called ACRIS and it shows you , like all of you are saying, the mortgage being recorded, and you can sell all the docs, but you never know the open balance unless the home owner shares it with you.

***you can see all the docs

Originally posted by @Isaac El :

***you can see all the docs


@Ron S.   Hi Ron, I was saying in New York, (city) there is a public system called ACRIS and it shows you all the mortgage docs that were recorded, satisfactions, etc

Originally posted by @Isaac El :

@Ron S.  Hi Ron, I was saying in New York, (city) there is a public system called ACRIS and it shows you all the mortgage docs that were recorded, satisfactions, etc

 Ok. I get that but, won't show you balances. It might show the balance at origination but, not curret balances.

@John Yu What about reverse mortgage? There are lots of reasons for pre-foreclosure situations so it’s helpful to know the influencing factors. I come across probate, medical, divorce and other situations. Owner also has to qualify for a hardship and be underwater.

@Elizabeth Miller With RM's, since they are insured by FHA, they must sell for at least 95% of a current fha appraisal.

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