I have a NPN 2nd note in GA which has no equity. I went through the FC process and now have the deed but the borrower still isn't responding. Based on the communication my workout specialist had with the wife(who is no longer responding and apparently is separated from husband and doesn't live in house) the house may be rented out. I'm sort of at a standstill. Being a fast state, I don't want to spend anymore money to evict only to then have 1st foreclose and I get nothing. I am not sure if 1st is current or not as it seems monitoring the 1st from a second standpoint is not as simple as I thought. What are some of my options or is waiting it out rather than spend any more money on legal the best bet ? As a Broker, I have seen many homes on Auction.com that were listed and of course a warning not to disturb occupiers. Some were even from 2nd position. I would think possibly seeing their house listed on Zillow via Auction.com and/or hungry flippers driving past might get their attention that we are serious. Any ideas? Thanks
Let's square you away a little better. First and foremost you no longer have a Borrower. The debt has been extinguished as a result of the foreclosure. The old borrowers owe you zero response.
Until you obtain a judgement to collect on a deficiency you have nothing to collect. Attempting to collect on a debt that doesn't exist is against the law in all 50 states. So you probably need to stop calling the wife before she gets annoyed and reports you and you get in trouble.
What you do have now is ownership of the property but you do not have possession. The legal remedy to gain possession is eviction. That is it. You can make direct contact with the occupants and see if they want to move or pay rent. You offer cash for their keys to encourage them to move, if desired.
If the occupant is one of the borrowers you have to make a formal a demand for possession. You have to give them time to move out which off the top of my head I don't remember what it is exactly. If he/she/they do not surrender possession then your only course of action is eviction. Period.
If the occupant is not the old borrower you will have a 90 day waiting period before you can process the eviction order by federal statue. (You can inquire about CFK during that time) (Even if they are a squatter) If the occupant has a lease/rental contract from the previous owner you are obligated to honor that lease provided it can be produced and is valid. You are governed by the landlord tenant laws in the state of subject property in regards to entering and perhaps repairing the property, etc.
I find it concerning the "workout specialist" does not understand the state of this asset and is walking down the wrong road. (very concerning)
As a property owner now, the first lien will have to serve you in any action to foreclose. You will have a right to redeem the property from the senior lien by paying the total due. You do not have a right to reinstate the senior lien as you are not the borrower. There might be a possibility to assume the loan but that requires the senior lien holder's approval and a loan that is allowed to be assumed.
It doesn't sound like you really have a plan to protect your investment here, unfortunately. Your ownership is inferior to the senior lien and you will remain in foreclosure risk until they are redeemed or actually foreclose your possession out. Your window to recover your investment is right now. There probably isn't a way around spending more money here. That said, if you do not have a plan on dealing with the senior lien you may be throwing good money after bad as senior foreclosure. You have an obligation to disclose the potential foreclosure to any potential tenant. Failing to do so gives the renter a right to sue you for rent and damages. If you disclose and they choose to move in, that is fine. There is also a chance to strike a deal with the current occupant, whomever it might be, to pay some rent during the window of time, however long it may or may not be, to recover your investment.
If you have some equity, which it doesn't sound like you really do, you might be able to refinance the property and payoff the senior lien in full. Since you are an owner the loan would be a refinance and not a purchase which would give you some relief from down payment and qualifications. A non-owner occupied - rate and term refinance would be your highest LTV potential. Unless of course you move in and designate the property as a primary.
If you care to share, I am curious, who is the work out specialist? Is it your servicer? What is the name of the company? This is all stuff they should know.
Let's square you away a little better. First and foremost you no longer have a Borrower. The debt has been extinguished as a result of the foreclosure. The old borrowers owe you zero response.
Until you obtain a judgement to collect on a deficiency you have nothing to collect. Attempting to collect on a debt that doesn't exist is against the law in all 50 states. So you probably need to stop calling the wife before she gets annoyed and reports you and you get in trouble.
What you do have now is ownership of the property but you do not have possession. The legal remedy to gain possession is eviction. That is it. You can make direct contact with the occupants and see if they want to move or pay rent. You offer cash for their keys to encourage them to move, if desired.
If the occupant is one of the borrowers you have to make a formal a demand for possession. You have to give them time to move out which off the top of my head I don't remember what it is exactly. If he/she/they do not surrender possession then your only course of action is eviction. Period.
If the occupant is not the old borrower you will have a 90 day waiting period before you can process the eviction order by federal statue. (You can inquire about CFK during that time) (Even if they are a squatter) If the occupant has a lease/rental contract from the previous owner you are obligated to honor that lease provided it can be produced and is valid. You are governed by the landlord tenant laws in the state of subject property in regards to entering and perhaps repairing the property, etc.
I find it concerning the "workout specialist" does not understand the state of this asset and is walking down the wrong road. (very concerning)
As a property owner now, the first lien will have to serve you in any action to foreclose. You will have a right to redeem the property from the senior lien by paying the total due. You do not have a right to reinstate the senior lien as you are not the borrower. There might be a possibility to assume the loan but that requires the senior lien holder's approval and a loan that is allowed to be assumed.
It doesn't sound like you really have a plan to protect your investment here, unfortunately. Your ownership is inferior to the senior lien and you will remain in foreclosure risk until they are redeemed or actually foreclose your possession out. Your window to recover your investment is right now. There probably isn't a way around spending more money here. That said, if you do not have a plan on dealing with the senior lien you may be throwing good money after bad as senior foreclosure. You have an obligation to disclose the potential foreclosure to any potential tenant. Failing to do so gives the renter a right to sue you for rent and damages. If you disclose and they choose to move in, that is fine. There is also a chance to strike a deal with the current occupant, whomever it might be, to pay some rent during the window of time, however long it may or may not be, to recover your investment.
If you have some equity, which it doesn't sound like you really do, you might be able to refinance the property and payoff the senior lien in full. Since you are an owner the loan would be a refinance and not a purchase which would give you some relief from down payment and qualifications. A non-owner occupied - rate and term refinance would be your highest LTV potential. Unless of course you move in and designate the property as a primary.
If you care to share, I am curious, who is the work out specialist? Is it your servicer? What is the name of the company? This is all stuff they should know.
I was asked off thread about the Tenant Protection Act I referenced and it's expiration. We had about a dozen situations this year where we maintained those same rules in the enforcement of foreclosure and eviction. They were not in the state of Georgia.
While the federal law expired local jurisdictions do have the power to enforce similar restraints on tenants. Some states considered permanently creating a similar statue.
So my inference above being federal mandate is not correct our situations would have been influenced by local rulings. Those may vary by local. Your counsel will obviously not let you file when you can't and will encourage you to file when you can.
Let's square you away a little better. First and foremost you no longer have a Borrower. The debt has been extinguished as a result of the foreclosure. The old borrowers owe you zero response.
Until you obtain a judgement to collect on a deficiency you have nothing to collect. Attempting to collect on a debt that doesn't exist is against the law in all 50 states. So you probably need to stop calling the wife before she gets annoyed and reports you and you get in trouble.
What you do have now is ownership of the property but you do not have possession. The legal remedy to gain possession is eviction. That is it. You can make direct contact with the occupants and see if they want to move or pay rent. You offer cash for their keys to encourage them to move, if desired.
If the occupant is one of the borrowers you have to make a formal a demand for possession. You have to give them time to move out which off the top of my head I don't remember what it is exactly. If he/she/they do not surrender possession then your only course of action is eviction. Period.
If the occupant is not the old borrower you will have a 90 day waiting period before you can process the eviction order by federal statue. (You can inquire about CFK during that time) (Even if they are a squatter) If the occupant has a lease/rental contract from the previous owner you are obligated to honor that lease provided it can be produced and is valid. You are governed by the landlord tenant laws in the state of subject property in regards to entering and perhaps repairing the property, etc.
I find it concerning the "workout specialist" does not understand the state of this asset and is walking down the wrong road. (very concerning)
As a property owner now, the first lien will have to serve you in any action to foreclose. You will have a right to redeem the property from the senior lien by paying the total due. You do not have a right to reinstate the senior lien as you are not the borrower. There might be a possibility to assume the loan but that requires the senior lien holder's approval and a loan that is allowed to be assumed.
It doesn't sound like you really have a plan to protect your investment here, unfortunately. Your ownership is inferior to the senior lien and you will remain in foreclosure risk until they are redeemed or actually foreclose your possession out. Your window to recover your investment is right now. There probably isn't a way around spending more money here. That said, if you do not have a plan on dealing with the senior lien you may be throwing good money after bad as senior foreclosure. You have an obligation to disclose the potential foreclosure to any potential tenant. Failing to do so gives the renter a right to sue you for rent and damages. If you disclose and they choose to move in, that is fine. There is also a chance to strike a deal with the current occupant, whomever it might be, to pay some rent during the window of time, however long it may or may not be, to recover your investment.
If you have some equity, which it doesn't sound like you really do, you might be able to refinance the property and payoff the senior lien in full. Since you are an owner the loan would be a refinance and not a purchase which would give you some relief from down payment and qualifications. A non-owner occupied - rate and term refinance would be your highest LTV potential. Unless of course you move in and designate the property as a primary.
If you care to share, I am curious, who is the work out specialist? Is it your servicer? What is the name of the company? This is all stuff they should know.
@Bret N. you quoted me but I don't see any response from you or questions.
Thanks for the info! The dialogue in reference with the wife was all prior to the FC and the WS told me these things could possibly happen. Of course, trying to paint what is a complex scenario into a forum is a challenge short of writing a novel. Typing is a challenge for my hands so I try and summarize the best that I can with the least amount of characters. Clearly I failed.
I got good advice based on the roll of the dice i chose to play by proceeding with the FC.
Based on a deal he worked out for me in another state,we had to go through with the FC process and then the eviction process for THEN the "human being that resides in the property" to finally come back to the table to work it out. In this case it was Ignored/no contact to then contact. In the GA case it was a few contacts( with wife who happens to be a Real Estate Agent and a chance she might help) to nothing and then the roll of dice with FC to nothing.
Rather than keep bothering him with my random ideas on how to possibly solve this quagmire and to also give someone a chance to learn who might have a similar issues as I do, I posted it on here to see if there was another legal way, short of spending more on legal to get them to contact us. Assuming the 1st is current that is. Which is why I asked about Auction.Com.
Thanks
The wife being an Agent is an important variable. Being that there is no direct contact with her. I'm wondering if I would have the right to contact an REO agent in her area or perhaps one in her office to do a BPO? Again, I have seen 2nds on Auction.Com that clearly states not to disturb tentant(right or wrong I don't know) up for bid. So with the assumption the 1st is current and they are just ignoring me, I wonder if this would get her attention in a passive/aggressive way to contact us and save face as the other deal I mentioned above did. It took one deal the eviction notice for them to then come back , perhaps on this deal it would an Reo agent in her office or her house on Auction.Com. Of course all this subject to the 1st.
The wife being an Agent is an important variable. Being that there is no direct contact with her. I'm wondering if I would have the right to contact an REO agent in her area or perhaps one in her office to do a BPO? Again, I have seen 2nds on Auction.Com that clearly states not to disturb tentant(right or wrong I don't know) up for bid. So with the assumption the 1st is current and they are just ignoring me, I wonder if this would get her attention in a passive/aggressive way to contact us and save face as the other deal I mentioned above did. It took one deal the eviction notice for them to then come back , perhaps on this deal it would an Reo agent in her office or her house on Auction.Com. Of course all this subject to the 1st.
Bret, it doesn't seem you get it.
YOU OWN THE PROPERTY.
She is nothing. What exactly do you want her or him to do?
They would have to actually buy the property back from you or rent it. You no longer have a debt to collect. She or he can not pay you off any more, there is NOTHING pay unless you give something back.
You need to stop this nonsense of trying to contact her and collect something.
You are playing with very hot fire poking around at her work with no debt to collect.
You own the property. Proceed with filing for eviction. If who ever is present in the property wants to stay they will make an effort to contact you or they will move out. (or get evicted) If she is not living in the property she is will not even be notified. Only the occupant.
The liens you see on Auction.com, if they are liens and not real property, say do not contact the borrower because the borrower has a right to their privacy and potential bidders on a loan are not owners of the loan. So barring contact prevents a would be buyer of the lien from jacking around collections established by the lien holder. That is standard process. It also has zero to do with what you have going on. You are the property owner not a lien holder anymore.
She can't pay you unless you give her something in consideration. That something would have to be title or possession. It seems pretty clear she wants nothing to do with this and you poking around is going to wake up a dragon that will come down on you very, very hard. You can NOT collect on debts that do not exist. You no longer have a debt to collect. It's gone. Extinguished.
I am repeating myself because you are not getting it and you tread on very thin ice with your actions. Stop before you get in trouble.
I love notes and solving paper puzzles since the late 70's.
I'm smiling because I share Dion's frustration.
@Bret N. You are now a landlord!
Reluctant, unplanned, undesirable or regrettable, once you complete foreclosure after forcing the sale and liquidation of the collateral for your note.
You bought a note, you played your cards a certain way, now you own an asset with no equity. You going to try and short sale it and spend more time and money for the benefit of the lender (since you probably will not net any profit got your efforts?
Or, can you rent it for anything close to break even?
Where is your time, money and new-found knowledge best applied going forward in the future?
I too have challenges typing (post-stroke paralysis means one hand works well).
You are right, I don't get it! If I did, I wouldn't be on BiggerPockets asking questions :-)If I want to have the luxury of badgering the rookies like you gentleman on BP in 30 years(although it might be BiggerPlanet rather than BiggerPockets at that time) I have got to ask questions. :-) If it frustrates you, go have a beer! :-)
That said, I am certainly on my way and appreciate the insight. It's always good to have others opinions and avenues of thinking. That's why I love BP!
Cheers!
The wife being an Agent is an important variable. Being that there is no direct contact with her. I'm wondering if I would have the right to contact an REO agent in her area or perhaps one in her office to do a BPO? Again, I have seen 2nds on Auction.Com that clearly states not to disturb tentant(right or wrong I don't know) up for bid. So with the assumption the 1st is current and they are just ignoring me, I wonder if this would get her attention in a passive/aggressive way to contact us and save face as the other deal I mentioned above did. It took one deal the eviction notice for them to then come back , perhaps on this deal it would an Reo agent in her office or her house on Auction.Com. Of course all this subject to the 1st.
Bret, it doesn't seem you get it.
YOU OWN THE PROPERTY.
She is nothing. What exactly do you want her or him to do?
They would have to actually buy the property back from you or rent it. You no longer have a debt to collect. She or he can not pay you off any more, there is NOTHING pay unless you give something back.
You need to stop this nonsense of trying to contact her and collect something.
You are playing with very hot fire poking around at her work with no debt to collect.
You own the property. Proceed with filing for eviction. If who ever is present in the property wants to stay they will make an effort to contact you or they will move out. (or get evicted) If she is not living in the property she is will not even be notified. Only the occupant.
The liens you see on Auction.com, if they are liens and not real property, say do not contact the borrower because the borrower has a right to their privacy and potential bidders on a loan are not owners of the loan. So barring contact prevents a would be buyer of the lien from jacking around collections established by the lien holder. That is standard process. It also has zero to do with what you have going on. You are the property owner not a lien holder anymore.
She can't pay you unless you give her something in consideration. That something would have to be title or possession. It seems pretty clear she wants nothing to do with this and you poking around is going to wake up a dragon that will come down on you very, very hard. You can NOT collect on debts that do not exist. You no longer have a debt to collect. It's gone. Extinguished.
I am repeating myself because you are not getting it and you tread on very thin ice with your actions. Stop before you get in trouble.
Let me be very clear.. I have NOT implemented ANY of these tactics above. So therefore to assume I am acting haphazardly is inaccurate. I come here with QUESTIONS and thoughts. The only thing I HAVE DONE is FC. I am at a crossroads which is why I am here with questions.
@Bret N. easy tiger.
The response posts were simply to get you to understand something that didn't seem that you were understanding. You are the property owner and the wife owes you nothing and collecting on a non-existing debt is against the law.
It is recognized that you have not done what you talked about nor did I/we imply that you did.
It's the interwebs and text lacks the nuances of conversation and body language but I assure you, nobody was demeaning you or the actions you had thought of. That said, I thought it relative to emphasize my utter disagreement and concern for the proposed actions.
Anywho, we are all good over here. Just having a conversation nothing more.
I would suggest an alternate description for your current place in the process of this asset. You are actually not at a crossroads. You have but one path in front of you and it is light up like Times Square tomorrow night. You now own a property with an occupant who should either pay you rent or go away. Right now is how you start actually making some money back. The large expenses to disposition the note are behind you. Now you have to deal with the real property and protect your interest in the real property to create some type of recovery on the amounts you invested. The finish line is in sight.
When it comes to anyone paying anything there are only ever two options: (a) they pay or (b) they do not. If they choose (a) deposit money into your wallet. If they choose (b) you will have to spend a couple bucks to get them to leave willingly or unwillingly. (Cash for Keys or Eviction)
Know that sooner or later the first lien will come calling and want their money as well. It is best to devise a plan on how you want to deal with that. As an owner you can refinance the property with a new lender. Alternately you can pull cash from your wallet and simply pay them off. Lastly you can sell the property for enough money to cover the senior lien and hopefully recover your money back.
While a rental arrangement might work, provided you disclose the property may be subject to foreclosure proceedings, chances are not often high for a tenant to want to move into such a situation.
Everything you do now is related to your ownership in the real property and nothing more.
Good luck and happy new year.
@Bret N. easy tiger.
The response posts were simply to get you to understand something that didn't seem that you were understanding. You are the property owner and the wife owes you nothing and collecting on a non-existing debt is against the law.
It is recognized that you have not done what you talked about nor did I/we imply that you did.
It's the interwebs and text lacks the nuances of conversation and body language but I assure you, nobody was demeaning you or the actions you had thought of. That said, I thought it relative to emphasize my utter disagreement and concern for the proposed actions.
Anywho, we are all good over here. Just having a conversation nothing more.
I would suggest an alternate description for your current place in the process of this asset. You are actually not at a crossroads. You have but one path in front of you and it is light up like Times Square tomorrow night. You now own a property with an occupant who should either pay you rent or go away. Right now is how you start actually making some money back. The large expenses to disposition the note are behind you. Now you have to deal with the real property and protect your interest in the real property to create some type of recovery on the amounts you invested. The finish line is in sight.
When it comes to anyone paying anything there are only ever two options: (a) they pay or (b) they do not. If they choose (a) deposit money into your wallet. If they choose (b) you will have to spend a couple bucks to get them to leave willingly or unwillingly. (Cash for Keys or Eviction)
Know that sooner or later the first lien will come calling and want their money as well. It is best to devise a plan on how you want to deal with that. As an owner you can refinance the property with a new lender. Alternately you can pull cash from your wallet and simply pay them off. Lastly you can sell the property for enough money to cover the senior lien and hopefully recover your money back.
While a rental arrangement might work, provided you disclose the property may be subject to foreclosure proceedings, chances are not often high for a tenant to want to move into such a situation.
Everything you do now is related to your ownership in the real property and nothing more.
Good luck and happy new year.
How did you know my middle name was Tiger? ;-)
It's cool!. I have read many of your 2k+ post so I knew your tone was to educate. I just wanted to make sure you knew I wasn't a complete idiot(just partially) :-). I think if I had some type of text that showed my mannerism and tone of more like Jim Carey and not snarky it would be great! ;-)
Happy New Years to you too!