All Forum Posts by: Carolyn W.

Wow, I really appreciate everyone's input here.  And thanks for looking at the big picture instead of just answering my questions.

@Scott Weaner/@Joel Owens I realize that from an investment point of view, tying up $300k in one house does not seem to be maximizing the investment. But I feel more comfortable with a paid off house, when we do (finally) retire. So I see the ROI as 6%, non-taxed, based on the fact that I don't have to earn $1500, pay taxes, to get $1000 to pay the 3.5% mortgage. Not an unreasonable rate for a secure investment that does not require the time, trouble and risk of buying a rental house instead.

But that being said, I would of course rather get 20-30% return instead.  I have owned rental properties in the past and the rents did not keep up with the expenses.  Some of that was due to our high property tax rate.  So I do plan to keep reading BP and learning more.  Who knows, here in the Houston area we may start to get more good deals with the lower oil prices.

@Jean Bolger I made the newbie mistake of including too much information, about cash purchase, age, school district.  Hard to balance enough info/too much.  So to add more information, my dh is 60 but I am younger and we have a 15 yo so schools are critical.  In our area the difference in school districts can affect the price by 50%.  Or more.  And our taxes are around 2.4% so yes, YIKES is right.  No state income tax, but it does increase your annual expenses a lot.

@Brent Coombs Yes, this particular house is appealing to me so that is why I started looking into the whole process.  This is one of those borderline deals for the seller that I don't think he could break even if he sold it with a realtor due to commission/closing costs.  So really, depends on the condition of the house if I would save 10-15% of the market price, so I guess that was my question about whether that was worth pursuing further.  I believe I read on another post that 70% of market price is a good figure to look for...which this is not.  So it could be one that should bought at auction, but I am not (yet!) qualified to do that I don't believe.

 So are there any tips on how to find contact info for trustee?  Do people just become familiar with the trustees in their area, and just know that information?

I totally see your point about paying cash versus financing, but we are 60ish and it seems prudent to pay cash for the next house.  That is actually why we are looking for a less expensive house, so we can pay cash...in our area $300k is "a less expensive house" although the property taxes will still be $7200/yr.  

Property value after repairs $350,000-$360,000

Estimated repairs ($20,000-$30,000)

Balance of 1st mtg (Everbank) ($271,985)

Balance of 2nd mtg (HUD) ($ 24,482)

Cost to cure loans-est ($13,000)

Est equity $10,533-$30,533

Puchase: 100% cash

For: primary residence

Plan: Offer owner $x ($5k??) (Depending on actual balances)

I am a total newbie. I was inspired by reading a long thread from @Sam Alpha where he was trying to buy from owner prior to foreclosure.

This is a nice home in a great school district near where I live. Have been looking for a home such as this to allow us to substantially reduce our housing costs. Houses sell quickly in this area.

I noticed this house is in preforeclosure and scheduled for auction. This person has had some problems and got a loan mod on 3/26/14 to $263,601 (but foreclosure notice shows full original loan balance of 271,985).

Some questions:

1) Is this worth pursuing? No idea if it really needs $20-30k repairs. Assuming if being foreclosed, some deferred maintenance. Used one year of interest for est. cost to cure loans.

2) How do I contact the trustee to find status? Have name of trustee. Have name of law firm. Very difficult to find trustee contact info.

3) From reading other postings, it sounds like newbies have a hard time buying at auction. Anybody on BP that is familiar with the Montgomery County TX auction (Spring/The Woodlands)?

4) Should I pursue a short sale? It is not an obvious negative equity situation…

Regards,

Carolyn