All Forum Posts by: Jake Boss

Has anyone completed any recent purchases / cash out refi with a HML / private lender that approves with condos?

For example: I have talked with LendingHome about an upcoming purchase of mine but they don't do any condos in HOA associations. I was okay with some of there rates around 5-6% with 20-25% down @ 30 year notes and only around 1.5% origination fees, etc.

I am just having trouble finding some around that rate / fees that allows condos. Any suggestions?

Thanks!

@Andy Gill Hello Andy, just wanted to follow up and see how this ended up for you? Did the surplus funds end up to the previously homeowner? Curious after you purchased at the auction, did the 1st lien mortgage lender contact you immediately after they found out there was an HOA foreclosure? How long did you have to pay that off and were you able to negotiate a discounted rate on the note?

Sorry for all the questions, I am looking into an HOA foreclosure currently and just had these questions myself. Any additional help would be very much appreciated!

Thanks!

@Wayne Brooks ok thank you! So once you take deed after the HOA foreclosure and the 10 day redemption period for the previous owner is over. It can be a quick turn around to sell on the market even with an outstanding 1st mortgage lien? Reason I ask I was unaware of the "due on clause" from that lien if the title was in fact transferred to me if they normally demanded payment in full. Or if that can be negotiated with the lender

Will obviously run the numbers to make sure the bidding price makes sense. But would I be able to make renovations to the unit then resell (assuming nobody lives there)? Or would it have be sold "AS IS" for a fast turn around

@Wayne Brooks Yes that is correct, I am aware of its only just a junior lien. I invest in vacation markets, is why I ask. Not sure if that would be viable if I were to win the auction and short term rent it until the 1st lien filed foreclosure...

In addition, if I were to win the auction. Would I be able to turn around and resell that property to try and gain that equity from the previous owner. Which in a sense would pay off the 1st lien and excess would be profit? With not a full clear title I am not sure if that even would be possible but was just curious if there were ways to go that route instead of renting it out.

Thanks so all your insight!

@Steve Babiak Hello Steve, I know this is an old post. But pertaining to the HOA foreclosure in which your friend purchases 2nd lien HOA foreclosures and then WAITS for the 1st lien most likely the bank to then foreclosure on him which we know can take quite some time and can be pushed back. Not sure, if you have any additional information on this is he able to rent out that property in the mean time / or live it in? What his exit strategy? Does he sell after the 1st lien does start the foreclosure process to gain back that equity? If you have his contact I would love to try and connect with him to see his thoughts. Reason I mention this I have an opportunity very similar to this with an HOA in FL and was just curious if this strategy was still working for him? Thanks so much!

@Brett Goldsmith 100% agree, I basically already penciled in the full original mortgage amount left over on the note. I did some more digging and it was an FHA loan they got as well with only around 5-6K down. Given the historic FHA rates back in May 2019 assume it'd be around a 4.5% plus with HOA monthly fees there payments got to be around $1700-1800 a month.

@Tom S. I have thought of that the reasoning would be I was hoping not to put that much cash in upfront on this deal. With the auction being less than 30 days away, it would need to be quite a quick turn around unless I went HML/private.

I was thinking though if I let it go to auction and win. I always have the option of either waiting for the 1st mortgage lien to foreclosure on me (could be years) IF i did not want to keep the property as that interest will obviously keep climbing. OR try and negotiate with the bank once I have possession of the deed after the auction.

Hello @Wayne Brooks - Thanks for reply. I have thought of doing Subject To however I am not super familiar with the process and will certainly have to do my own due diligence on that. Yes I have looked up all the records in the Clerk of Courts and the bank has not filed foreclosure it is only the HOA who has filed.

Hello @Wayne Brooks - Thanks for reply. I have thought of doing Subject To however I am not super familiar with the process and will certainly have to do my own due diligence on that. Yes I have looked up all the records in the Clerk of Courts and the bank has not filed foreclosure it is only the HOA who has filed.

Hello All!

I wanted to run by a scenario I am looking more into. I came across an HOA foreclosure in an awesome area, I have been looking at for some time. The amount due to the HOA association is $9K. I understand that in this case, the 1st lien which is the mortgage will not disappear as the winning bidder will have a due on clause of the remaining amount (state is Florida). The property was bought only 2 years ago with a loan amount of $183K over 30 years. Market value currently is around $250K.

I have been doing some research looking through the case dockets, etc. and it does appear the the couple is going through some hard financial times currently. Possible health issues / lost job, etc.

Instead of waiting for this to go to auction I was thinking of reaching out to the couple personally to try and work out a deal.

There are obviously multiple avenues I could go. I have thought of offering to pay the HOA fees off in full to cancel the foreclosure and then give a simple cash offer OR try and go the seller financing route. If bought, I don't want them to live there as I would plan to renovate and rent myself.

Assuming the left over mortgage lien is still around $170-175K that is more than id be willing to pay cash for, hence my thought of seller financing. Unless they did the process of a short sale (I am not to familiar with how this works or what qualifies per the lender)

I was curious to see in this scenario how you would try to structure this?

Thanks!