Rental Property Investor · Indianapolis, IN · Member since 2014 · 554 posts · 153 votes
Sent a letter to a home owner one month ago. Received a call that they want to sell. Turns out the property is still in the name of the deceased parents in which they owe 70k on the mortgage. The house is in pretty distressed condition. There are 5 heirs in which two want nothing to do with the property. The lawyer needs all the signatures to move forward in doing a possible short sale, which two heirs will not comply(because they may not get any profit)
I do not want this property to become foreclosed upon.
You're dealing with five people and two of them are not cooperating. You are fighting an uphill battle. Spend a little money with the attorney to draft everything that needs to be signed, use little stickers to show each one where to sign and drive to each of them and state your case and explain that you will do all the legwork and chase them around. In your first meeting with the two dissenters you will likely be able to gauge whether or not the deal is worth pursuing.
Did you say short sale? What would the heirs benefit be in paying for probate if they are to receive nothing? What is your plan to monetize the situation?
Wow, not a good situation. @Sterling White I commend you for trying to make it work, but it sounds like this is becoming more trouble than it's worth. I've recently had to let go of a couple of deals I wanted (including a probate deal) because I realized a few weeks in that some of the specific complications and uncertainty were no longer worth my time.
@Sterling White The lender is going to be stiffer "competition". They're going to want something close to FMV. @Rick H. was just trying to think of the limited number of things that could make this less promising than it already is.
I think what everyone is politely trying to say is "this appears to be a big waste of your time!"
That's why I asked what the numbers were. I wanted to see if you saw a play that we all are missing.
Correct me if I'm wrong, but currently the loan and the liability all lie (no pun intended, hehe) with the deceased. If there is no money coming to the heirs, I'm not sure it's in their best interest to transfer that liability to themselves. You really need to think beyond profit and make sure this is a win win for everyone.
Short sales rarely produce discounts all things being equal. If you can buy it for fair market value, do capital improvements and sell at fmv and have a spread, it works. But you will get greater discounts dealing with motivated seller. A short sale is not a motivated sale.