Pre- foreclosure question

[Quinton Washington]

Hey I know that your in real estate and know about wholesale deals. I have recently met a guy thats house is going into foreclosure and he owes 4K in back payment and wants to see it for about $10,000 just to get out of it and to move. It's worth about 120,000 any suggestions?

[Account Closed]

@Quinton Washington "He has been in the house for 14 years and he is unsure of the final number owed on the house. His motivation is saving his credit." "house is going into foreclosure and he owes 4K in back payment"

His credit is already trashed if he owes $4k in back payments and is facing foreclosure. His credit report will say "foreclosure" if he receives a Notice of Foreclosure or Sheriff's Sale Notice. 

If the goal is to "save his credit" you would want to take over his mortgage, make the payments to bring the loan current and make sure the payments are made on time going forward. After a couple of months, they *usually* reset the mortgage line on the credit report to say "paid as agreed*. You can do this Subject To and take the Title into your name but he stays on the loan. 

This is an ideal situation where you can help someone out and acquire a property. He needs to know though, you are not removing his name from the loan until it clears up the credit by making payments on time. 

The related, but not the same issue, is the question on the Uniform Residential Loan Application Form 1003 that everyone fills out when they take out a mortgage. 

Under VIII. DECLARATIONS: The question is asked: 

"c. Have you had property foreclosed upon or given title or deed in lieu thereof in the last 7 years?"

If you let the property go to sale, that is *YES* and that is a *very bad thing*. If you reinstate the loan, you then did not go to sale, so the answer is *NO* and that is a *very good thing*. Lenders don't like it when people won't move heaven and earth to make their mortgage payments. For some odd reason, lenders like to get paid back, and they want it "as agreed". A Pre-Foreclosure is not a Foreclsoure. You are currently talking about a Pre-Foreclosure. The house has not yet gone to sale.