Investor · Marin County California · Member since 2018 · 1k+ posts · 2k+ votes
6y
You will need to cure the default ($6,561) for sure.
If the owner is willing to let you have the place subject to the existing mortgage, paying some portion of the $18,000 the owner is out ($55K less $37K) might entice the owner to give you the keys and quitclaim you the property.
Two BIG caveats. This solution is maximum benefit/maximum risk as the lender could call the note based on the due on sale clause in the owner's promissory note. Also, you should check your local jurisdiction's law to see if this could be considered in any way unlawful "equity-skimming."
owner is dead this is in bank trust - going to auction - min bid 22k neighborhood has lots of teardowns and new construction. Could possibly even do this with the property since it is such a large lot. Is it possible to go to bank before auction to make an offer?
worried less about the cost than the process. I wouldn't make an offer without due diligence. Bought and sold homes before, but never have dealt with auctions or foreclosures...different animal.
Real Estate Investor · Crescent Mills, CA · Member since 2010 · 127 posts · 74 votes
6y
You mentioned trust - if deceased owner owned property in a trust, then there is probably a successor trustee. A successor trustee can sell it.
If you really don't want to own it, you could consider a "sandwich lease option" if the trustee is agreeable... You lease from owner, then lease to a tenant (thus sandwich - you're between owner and tenant). BUT one normally doesn't do a lease option if you have to put much money into it to make it livable (roof?).
Either way, you'll have to cure the default. (either by paying or by negotiating some alternative (tacking missing payments on loan?). )