Real Estate Investor · melbourne · Member since 2008 · 44 posts · 1 vote
I am having trouble with Chase on a second mortgage. After numerous conversations they continue to say they will settle for nothing less than the full amount $50,000. They are saying my bid for the house is to low at $132,000. I do not understand their fixation with the $132,000 since the are not they are not the primary lender. Their are no current comps in the area and the current listings run about $240,000 with nothing moving. Chase requested a BPO which I walked with realtor and reviewed the area MLS with her and while she did not give me her BPO price she did say those listings are not moving because they are to high. In my most recent conversation with Chase they said the BPO came back at $300,000 which I know is rediculous. Has anyone else had these issues or advice. Thanks.
Property Manager · Portland, OR · Member since 2008 · 212 posts · 14 votes
17y
Until you get the approval on the first, you can lay off the 2nd lienholder.
Once you and the 1st agree on a price they will send the file to a closer. At that point you have quite a bit of leverage on the 2nd mortgage because you will have, in hand, an approved payoff from the first.
You don't need another BPO from Chase...it sounds like the first one they did was a drive by / check for occupancy. That being said, when a bank tells you they have done a BPO, you must request that an Interior inspection be done. Junior lienholders will typically only do an exterior BPO and therefore the values are off.
So it looks like your next step is to hammer the first mortgage on the approved price. This can be done several ways: Get a home inspection and use that to justify your offer...or if you want to spend a bit more money, order an appraisal. Make sure you are at the house with the appraiser, bring him/her the comps you would like them to use and if you have the home inspection done already, make that available as well.
Regarding excess funds in closing...be careful here...most approval letters specifically state that any excess funds transacted are the property of the lender in first position. Some lenders will just give you an approved payoff, wiring instructions, and thats it.
Overall, get that approval from the first and then go after the 2nd.
Also, I may have missed it in the previous posts, but is there an auction date assigned?
Real Estate Investor · melbourne · Member since 2008 · 44 posts · 1 vote
17y
Thanks for the excellent advice Mitch. No auction date has been assigned. We are still trying to get the first down from 229k and then will finish with the second. It has definetly been a learning experience but may still end up being a good deal for us.
Real Estate Broker · Fort Pierce, FL · Member since 2009 · 221 posts · 95 votes
17y
To answer your initial question with a question in reference to the 2nd ordering a BPO. Could the 2nd be positioning themselves to purchase the 1st? I've only had it done about four times, but it not impossible.
From reading this post, I must say, thanks for the education posters!