Updated over 1 year ago on . Most recent reply
Parents battling foreclosure for years
My parents built a home in 1999. It's appraised at 430k. They have been battling foreclosure for well over 5 years. Just barely scrapping by to keep the loan current the best they possibly can.
They owe $141k on the first mortgage. They owe $218k on 2nd mortgage. They also likely owe $18k in past due amounts for the 2nd mortgage. We have called and they are mailing confirmation of past due.
I would like to purchase this home for between $330-360k. This would pay off 1st mortgage in full and pay of between 190-220k on the 2nd mortgage. Is it possible to negotiate some sort of settlement with their 2nd mortgage to accept less than the total amount due?
1st mortgage is current. 2nd mortgage they recently did a loan modification program. They must now make 3 payments of interest only payments of $495.60 to continue on this program.
Please let me know any further details you may need or any insight you can provide.
Most Popular Reply
#3 Creative Real Estate Financing Contributor
@Matt Morgan I'm pretty sure they can't sell it to you for less than is owed as you are related to them. If it is worth $430K, pay more than they owe on it giving them some money in their pocket to get started again and you're still getting a good deal. As they've owned the home for 20 years and owe $350K on a home now worth $430K, that isn't a lot of equity and is a large balance on the mortgage.