Liens

5 Replies

Hello everyone!

I have a question... Not sure how to ask it so I'll just spill it.

Someone I know is on the verge of foreclosure. As far as I know he owes the bank around $1000 by a certain date. Is there a way for me to pay the $1000 and  hold it as a lien and if he doesn't pay it back in a certain time frame I take over the note..... ??? 

I have no clue if this is possible.. 

Someone please let me know.

Thanks

Shakiah Naverre

You are going to execute a note for him in exchange for $1,000? If so, you already own the note so there is no note to take over. If what you meant was, do you take over the note that he is delinquent on with the lender/servicer/bank on the home currently, in the event of default with you? No. You don't take the note over. You are a junior lien holder to them (Assuming you record your lien). So, you can foreclose on him if he doesn't pay you and you would do that subject to the existing senior lien, which you would have to pay off eventually.

Be careful if you become a lien holder and subsequently try to foreclose. Is this person a friend? I'd be cautious mixing friendship with money.

Hi

He is family. I am new to this. Therefore I'm not sure how it works.

I wanted to know if it was possible for me to pay the amount that he owes and I type up a paper pretty much stating that if he doesn't pay me the  $1000 back the property is mine. Which means I then take over th notes on the house right??? I'm really not sure how that works.

No, take something else as collateral, like a car, or his first born. 

Question is, why is he in this situation, clear that up too. 

$1,000 is below minimum mortgage lien limits. And no, you can not just assume his payments. You might buy it subject-to in a family deal. 

Assumptions get much deeper with family, relationship, why do it or ask, the type of loan, etc. If it's a problem loan I'd just get it caught up and not put the deal on the lender's radar more than it is. :)

lol his first born☺️

He has been out of a job for a year. He probably won't be able to come up with the money by the deadline and if he does it's a possibility he won't be able to make the next few payments. I just figured since he's had the house nearly forever it would be better if someone in the family kept the hose and he could possibly rent it from in the future then loose it to the bank. 

Originally posted by @Shakiah Naverre :

lol his first born☺️

He has been out of a job for a year. He probably won't be able to come up with the money by the deadline and if he does it's a possibility he won't be able to make the next few payments. I just figured since he's had the house nearly forever it would be better if someone in the family kept the house and he could possibly rent it from in the future then loose it to the bank.