Foreclosure - Pay Reinstatement, Quit Claim, then Refinance
Hello BP Family,
I have been getting a lot of pre-foreclosure leads. This is where the auction date has been set and the owner is trying to leave the property but not affect their credit.
There is a low-equity deal that I have under contract to try to wholesale, but it would only make sense for the end buyer to buy and hold. Auction date is next week and not enough time to find a buyer for a Lease Option. Little fixes are needed. Just paint and cleaning.
My question is as follows:
ARV: $156k
Re-instatement Amount: $10,000 (Past Due Amount) + $1,000 - $2,000(Attorney Fees)
Monthly Payment: $1,420
Can I pay the reinstatement of around $12,000, then complete a Quit Claim deed with the owner. After 2-3 months of paying the owners mortgage and renting it around $1,500. Will I be able to refinance at a lower rate since my name/LLC is now on the deed and the old owners mortgage will then be paid off? Also, is this a smart strategy?
Thanks!