Greenacres, WA · Member since 2018 · 3 posts · 0 votes
Looking to buy my first investment property and I have found a potential property that is in preforclosure. However the deceased owner had a reverse mortgage around $300,000. Her son is wanting a short sale before it is auctioned off. Currently auction cannot proceed because there are many squatters living at the property. I am a new real estate agent, so I have all the title info but confused how the reverse mortgage would affect the sale and who I should contact? The bank with the reverse mortgage? Any thoughts would be greatly appreciated!
Rental Property Investor · Chicago, IL · Member since 2019 · 14 posts · 2 votes
7y
@Samara Thelen Hi my name Davion and if the property your looking at is in the the Washington area I can help structure the deal for you as my grandmother is the best Investor in the country when it comes to these type situations and she works in the Washington and maryland area o
Investor · Los Angeles, CA · Member since 2012 · 1k+ posts · 500 votes
7y
Does the son has authority to sell the home? Is the son an executor of the state or on title? Is there a trust? Whoever is in charge would need to contact the mortgage servicer to begin short sale process.
An appraiser would need to get into the home for a short sale so the squatters is likely one of the biggest issues.
Why would squatters prevent a foreclosure auction from occurring?
Getting good buys on reverse mortgages are a bit harder because they want an offer at 95% of their appraised value.
Is the son motivated to jump through many hurdles to try to get this sold?
There are a few factors that make this one potentially challenging.
Lender · Huntington Beach · Member since 2008 · 120 posts · 57 votes
7y
There are two 6 month periods that the family can use to figure out what they want to do. So they get 6 months and then can ask for a 6 month extension. Family members can buy the property at 95% of the appraisal value so they do have some leverage.
Rental Property Investor · Chicago, IL · Member since 2019 · 14 posts · 2 votes
7y
@Samara Thelen Hi my name Davion and if the property your looking at is in the the Washington area I can help structure the deal for you as my grandmother is the best Investor in the country when it comes to these type situations and she works in the Washington and maryland area o
Greenacres, WA · Member since 2018 · 3 posts · 0 votes
7y
Thank you all for your advise. The whole process just seemed too risky. Going to stick with vacation rentals for now. I really appreciate the information though.