Received a pre-foreclosure lead and need some help:

Property details: 3 bed, 1.5 ba 1200 sq ft home, move in ready. Market value is $80k-90k, and market rents are $900-1,000/mo. Attempting to get under contract for $63k (mortgage payoff amount). Delinquent owner is still living there and must give their ex-husband a 30 day move notice with new address before they can leave (due to situation with their child). Owner has stopped paying for the last 3 months and just received a "summons" in the mail but with no date for a hearing.

My intention is to wholesale the property, but I'd like to make sure I'm doing everything right and most importantly not disappoint the owner as my goal is to help her avoid a foreclosure on her record and for it to be a win-win.

Does anyone have a step by step process of a foreclosure that I can reference so that I can pin-point where in the process I am? I also want to make sure I am able to wholesale the property, and that there isn't a rule somewhere that says it must go to sheriff sale first, etc.

The mortgage company says I need to have them add me as an authorized third party to get information about the account. Once I get that access, what do I need to ask other than payoff amount? Anything else I'm not thinking of here?

Thanks!

@Neil Goradia

The owner can get the payoff amount for you. However, that will just satisfy the mortgage due. They'll still have closing costs to cover.

Indiana is a judicial foreclosure state. Average time is 150 days.

It involves a lawsuit process. Since they just got the notice of default, you have are at the early states. Notice of defaults are usually issued after 90-120 days delinquent.

@Christopher Phillips , thank you for the information!

So there isn't any rules against having them sell the house once the foreclosure processes has started, right? Just don't want to buy something that will show up as invalid afterwards. Is it really as simple as buying the house from them to stop all the proceedings and resolve the situation?

In her summons letter, it says she must respond with an answer within 20 days to ask for a settlement conference, otherwise the courts may grand a default judgement. I was probably just going to call the plaintiff attorney on the summons.

@Christopher Phillips crushes again...

@Neil Goradia

The only issue you might have would be if they owe more than the house is worth. Then it will have to be a shortsale and the lender will want it listed on the MLS. Also, be mindful of the fact that when people stop paying their mortgage they usually will have other unpaid things that might have a lien against the property.

If they do have a little equity, you might be able to get it with enough of a discount to make it worth your while and also cover their expenses for the mortgage pay off and closing costs.

At the end of the day, if the numbers work, then the owners just need to let the bank and the courts know that they plan to sell the property. The bank just wants their money, they don't want added expense of a lawsuit.

Perfect, thanks @Christopher Phillips ! I'll give it a try. I think there is enough equity here to make it work.

@David Weintraub

I'm just trying to keep up... :-)

Originally posted by @Christopher Phillips :

@David Weintraub

I'm just trying to keep up... :-)

 puhlease. you're leading.

Originally posted by @Christopher Phillips :

@Neil Goradia

The owner can get the payoff amount for you. However, that will just satisfy the mortgage due. They'll still have closing costs to cover.

Indiana is a judicial foreclosure state. Average time is 150 days.

It involves a lawsuit process. Since they just got the notice of default, you have are at the early states. Notice of defaults are usually issued after 90-120 days delinquent.

 you cannot record the first legal action prior to the 120th day of delinquency from the due date of the last paid installment.