I am new to real estate investing and I am trying to understand the how a whole seller helps a home owner in pre-foreclosure.
So far it is my understanding that I identify a person in pre-foreclosure, and with their permission (I get the home owner to deed me the property, making me the owner?) I negotiate with the lender a discounted price for the remaining balance of the loan,once that figure is agreed upon, sell the property to the new buyer. I am kinda confused on what is the best way for a wholesaler to tie up the property to be able to talk to the lender and wholesale the property to a buyer. Can someone please clear this process up for me.
How much equity does the homeowner have? Are they ok with just walking away if they can avoid foreclosure? If so you can simply contract the property for the remaining mortgage balance and find a buyer willing to pay a bit more than that. Or would the homeowner consider keeping the existing mortgage in place and you do a sandwich lease option(or rent to own w/option to buy), where you essentially find a new tenant to take over payments? Again, this would all be based on the numbers if these strategies would work. Works for some.
You must be a BiggerPockets member to post on the forums
Join the world's largest, most open Real Estate Investing Community online, 100% free forever!