Hi. I'm new to investing. I just wondered if it would be a good idea to propose seller financing to an owner of a property in foreclosure. I am not sure if they need cash or most of the money to give to the bank right away. Please advise.
@Pamela Soto There are several factors at play, and one of your jobs is to find out what the property owner's problem(s) are and offer creative solutions to those problems. As such, there are a number of things you'll be looking to discover, such as...
How far along in the foreclosure process are they?
How far behind are they with their payments...how much will it take to bring the note current?
What is their goal? Do they just want to move and be done with it? Do they need money in order to move? Do they want to avoid having a foreclosure on their record? What do they need?
What kind of equity to they have in the property?
What are the terms of their current mortgage?
Are there any other (tax, 2nd mortgage, etc) liens on the property?
The answers to all of these questions and more are going to help you figure out what - if any - strategy you can employ to help this property owner with their pain point.
For instance, if they have recently received the NOD, got behind because of some outside factor but can make the payments, and want to stay in the house, you can refer them to a loan modification source.
If they can't afford the property, but want to avoid foreclosure, you may be looking at helping them negotiate a short sale.
There are a myriad of options depending on what the owner needs/wants and what their particular situation is.
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