Rockton, IL · Member since 2017 · 2 posts · 0 votes
I am looking at buying a house in the San Diego area and the current home owner has a year of missed payments on her mortgage. What responsibilities should I expect to fall on to me if I were to purchase the property? What techniques can I use to find out more about what she may owe and who may have rights to the property already? I just don't want to be blindsided. Any information would be appreciated.
She has a total of a year of missed payments, or she hasn't been making payment for the last year? If the home is in pre-forclosure than she might not have the right to even sell the property. I was in process to purchase a home from a seller that failed to disclose that she had not been making payments. Turns out 2 days before my closing that it finally came to light through title search. The seller was not allowed to sell the house unless she brought her mortgage to current. She was to bring 10k to the table in order to have rights to sell the home.
Normally it's the title search that finds things like this, but normally it's done too late in the process to really make a difference in my opinion. Had it been the first thing to look at, I would have saved 45 days of my time and the money spent on inspections and appraisal. The seller should know if they have started the foreclosure process as it's required by law to let them know. If somehow everything works in your favor and you are still worried, I would go ahead and have the seller pay for an owner's title policy to protect your equity.
She has a total of a year of missed payments, or she hasn't been making payment for the last year? If the home is in pre-forclosure than she might not have the right to even sell the property. I was in process to purchase a home from a seller that failed to disclose that she had not been making payments. Turns out 2 days before my closing that it finally came to light through title search. The seller was not allowed to sell the house unless she brought her mortgage to current. She was to bring 10k to the table in order to have rights to sell the home.
Normally it's the title search that finds things like this, but normally it's done too late in the process to really make a difference in my opinion. Had it been the first thing to look at, I would have saved 45 days of my time and the money spent on inspections and appraisal. The seller should know if they have started the foreclosure process as it's required by law to let them know. If somehow everything works in your favor and you are still worried, I would go ahead and have the seller pay for an owner's title policy to protect your equity.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
9y
@Nicholas Covingtona borrower in default Always has the "right" to sell the property......but this includes paying off the mtg in full.
@Matt Rogers You need to know the pay off, which the owner can get a pay off letter/email from the lender..... or they can execute an Authorization To Release form and their mtg co. can disclose directly to you. A title search, as mentioned, is always a good idea, up front, so you'll find any other liens,debts or title issues with the property. A straight up purchase is simple if you are paying off the mtg, trying a sub2 by just making up the past payments is dicier.
I am looking at buying a house in the San Diego area and the current home owner has a year of missed payments on her mortgage. What responsibilities should I expect to fall on to me if I were to purchase the property? What techniques can I use to find out more about what she may owe and who may have rights to the property already? I just don't want to be blindsided. Any information would be appreciated.
Hey Matt,
Definitely a number of variables to consider when approaching a purchase like this. A good title company/rep will be tremendously helpful, for starters. I have an awesome one I can refer you to, if needed.
Please feel free to reach out if you would like some assistance with the investigation process. I'd be more than happy to help!