Paterson, NJ · Member since 2014 · 7 posts · 2 votes
Hello Bigger Pockets community,
I am a beginner investor that is starting to build his career in the industry by assigning houses to other investors. So I found a house in a great neighborhood (Bayonne, NJ) thats in pretty good condition from what I can see that would make for an ideal flip. I spoke with the home owner and scheduled a time I can take a look at the property but while speaking with her, I had one reason to pause. She currently has 2 mortgages on the property and this something I have never heard of or aware was possible.
Seller is looking to have both mortgages paid off as well as walk away something in pocket as well.
So in short, what strategies would you implement for something like this or is this a bit too much for a beginner like myself?
Ask her for payoffs for both mortgages asap. Order a title report to make sure those are the only liens, and then see how close the sum of the 2 mortgages is to the price you would be willing to pay. If you pay them both off, how much room is there to give the owner something and you still profit?
@Gary Josephs What @Jessica Zolotorofe said is exactly the way to go. Just an FYI 2 Mortgages are not that uncommon. It could be a first and 2nd mortgage when she purchase the property (80/20) or a mortgage with a line of credit or HELOC. Just think of it as just another payoff, thats all no big deal.
The only thing I would add to check are to see if there are any back taxes. Add it all up and see if you have room to make a profit or whatever your strategy is.