HOA Foreclosure Opportunity Advice

3 Replies

Hello All!

I wanted to run by a scenario I am looking more into. I came across an HOA foreclosure in an awesome area, I have been looking at for some time. The amount due to the HOA association is $9K. I understand that in this case, the 1st lien which is the mortgage will not disappear as the winning bidder will have a due on clause of the remaining amount (state is Florida). The property was bought only 2 years ago with a loan amount of $183K over 30 years. Market value currently is around $250K.

I have been doing some research looking through the case dockets, etc. and it does appear the the couple is going through some hard financial times currently. Possible health issues / lost job, etc.

Instead of waiting for this to go to auction I was thinking of reaching out to the couple personally to try and work out a deal.

There are obviously multiple avenues I could go. I have thought of offering to pay the HOA fees off in full to cancel the foreclosure and then give a simple cash offer OR try and go the seller financing route. If bought, I don't want them to live there as I would plan to renovate and rent myself.

Assuming the left over mortgage lien is still around $170-175K that is more than id be willing to pay cash for, hence my thought of seller financing. Unless they did the process of a short sale (I am not to familiar with how this works or what qualifies per the lender)

I was curious to see in this scenario how you would try to structure this?

Thanks!

You could of course buy Subject To the mtg, with the proper disclosures, etc. Be aware, I recently read about new laws that deal specifically with buying from sellers in foreclosure. There seem to be some strict requirements/restrictions. You can google up the state statutes. 
Have you checked to see if the mtg holder has filed foreclosure (an LP gets recorded in the Clerk of Court files, available online. 

Originally posted by @Wayne Brooks :

You could of course buy Subject To the mtg, with the proper disclosures, etc. Be aware, I recently read about new laws that deal specifically with buying from sellers in foreclosure. There seem to be some strict requirements/restrictions. You can google up the state statutes. 
Have you checked to see if the mtg holder has filed foreclosure (an LP gets recorded in the Clerk of Court files, available online. 

Hello @Wayne Brooks - Thanks for reply. I have thought of doing Subject To however I am not super familiar with the process and will certainly have to do my own due diligence on that. Yes I have looked up all the records in the Clerk of Courts and the bank has not filed foreclosure it is only the HOA who has filed.

 

Hello @Wayne Brooks  - Thanks for reply. I have thought of doing Subject To however I am not super familiar with the process and will certainly have to do my own due diligence on that. Yes I have looked up all the records in the Clerk of Courts and the bank has not filed foreclosure it is only the HOA who has filed.

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