Investor · Orlando, FL · Member since 2017 · 51 posts · 10 votes
Help me understand this:
While looking at a house, I found another distressed property. A title search shows it was bought in 2005 at 30y fixed with a 80/20 infamous mortgage scheme: - First mortgage (80%) $113,600 - Second mortgage (20%) $28,400 (assigned to another bank 3y ago)
Assuming ~6% interest back then, payments would add up to $851/mo. I estimate a principal reduction of ~$20K at best from the original $142K. ARV is around $130-140K, but the repair figure is unknown, perhaps 20-30K. I did not find other liens, taxes are up to date.
Since 'there is no meat on the bone', is there any deal to come by here, considering the owners are in distress and may be heading into foreclosure? Even assuming payments doesn't seem like a good deal. Ideas?
Investor · Orlando, FL · Member since 2017 · 51 posts · 10 votes
9y
Thanks Brent Coombs so then the only recourse would be to wait for foreclosure if ever to negotiate a discount on the second mortgage? Still would not be a good deal, man, no equity there...
Orlando, FL · Member since 2017 · 41 posts · 6 votes
9y
Federico Laham One of the things I do when looking up a property is to check if the owners are paying the property tax. If they are, I lose a bit of interest because my guess is that they still want to hold, or might not be a motivated seller. But I could be wrong. If they owe too much and the value of the house is not much. I don't bother and move on to the next.