All Forum Posts by: Nancy Zhao

I don't see that being probable (Possible? Maybe but I doubt it). Traditional HARP loans were for GSE loans originated prior to May, 2009 and Fannie/Freddie loans were subject to conforming limits so, it wasn't a HARP loan if there was a refi in 2017 and for that amount although, if the loan balance was ten times lower? That scenario could work. It isn't a reverse mortgage either as there is an equity requirement for the reverse program. It isn't a neg am loan since those don't exist any more and didn't last year either so, none of those scenarios would work for how the balance could be twice the value (Or any factor above the value).

The only thing I can think of is that you don't have a copy of the appraisal done when the loan for $3.2MM was done. Maybe you know the area or live next door and have a better idea than most about the values in the neighborhood. Maybe it's a typo on the loan amount?

I can't think of any scenario where any lender in business (and wanting to stay in business) would lend twice the market value unless they cross collateralized multiple properties of the borrower in the same loan. The only way to find that out is to look at the note.

It's a strange scenario for sure. After the home was purchased with a loan, there was a series of second mortgages and even a line of credit for 300k as late as 2015. All of this was well over the property's market value at any given time in history.

Then everything was refinanced into one $3.2 million loan by a small local bank, which the owner promptly defaulted on. I guess I need to pull the loan documents if only to satisfy my own curiosity.

If you have access to those non public documents, you are ahead of everyone else.

Good point. And you were right, I found a UCC statement that showed the property was cross collateralized with personal property for the loan.

1 Vote

In my experience people who buy at auction.com auctions tend to overpay, with some even going over fair market value. Just becareful not to get caught up in the heat of the moment when you bid.

The company itself is reputable, bidding on one of their auctions is less risky than a standard trustee auction.

I wouldn't pay to get a title search done. 90% of auction.com properties get delayed or cancelled. There are services that let's you buy recorded documents for a small fee and you can do the title search yourself.

1 Vote

Originally posted by @Ron S.:

Then everything was refinanced into one $3.2 million loan by a small local bank, which the owner promptly defaulted on. I guess I need to pull the loan documents if only to satisfy my own curiosity.

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Originally posted by @Chris Seveney:

Nancy Zhao
Depends
- in many instances property values fell dramatically. Other instances they stopped paying and the fees and interest collected goes up quickly including legal etc.

I hold the note on a property that the unpaid principle balance is $65k but it has $85k in late payments, fees etc.

No I mean, at the time the loan originated, the property was worth less than half of the loan amount. This is before any late fees, changes in property value, etc. In the example I listed, the home was refinanced in 2017 when it was worth approximately $1.5m, but the owner somehow got a loan for $3.2m.

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I see these kinds of properties occasionally. Where the owner somehow managed to borrow twice the market value of the home at the time of the loan. This is before taking into account unpaid interest and late fees.

For example this home was worth less than half the amount the owner refinanced into, and this took place in 2017...

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OK, I posted and mailed the former owner a 3 day notice and a notice of abandonment. The utilities are still off and I have repeatedly visited the property at all hours and nobody's ever been home. Tomorrow the three days are up and I'm going to just get a locksmith and take possession.

Fingers crossed, thank all you guys for your help!

1 Vote

Originally posted by @JD Martin:

If it were my house, I would just go there and take possession. You say you've already bought the house. If there's no one in the house (or even if there's a squatter in there), I would move forward. Hire someone else to do it if you're afraid of meeting up with a person - hire a locksmith to change all the locks. Or a security firm.

Can I legally do that in California? I thought you had to go through the eviction process for foreclosed properties, I've always just done cash4keys.

This is a trustee's sale.

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I purchased a foreclosed property whose owner is in prison pending multiple felony charges. It doesn't look like she will be bailed out and the property is currently vacant. I drove by a bunch of times and the electricity is off and nobody is living there. However, there is a fairly new car parked in the driveway that doesn't appear to have been moved in a month or more. The property was in both the owner and her ex-husband's name as was the foreclosed loan, but it appears he hasn't lived there since they divorced years ago.

How would you guys approach this? Try to contact the owner's attorney and offer them money? Contact the ex-husband whose name was on the deed and negotiate with him? Can I just do a 3 day notice, change the locks and take possession? This is in California.

Thanks!

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All Forum Posts by: Nancy Zhao

Nancy Zhao has started 11 posts and replied 68 times.

Post: Why do some foreclosures have >200% LTV?

Post: Auction.com - what do you think?

Post: Why do some foreclosures have >200% LTV?

Post: Why do some foreclosures have >200% LTV?

Post: Why do some foreclosures have >200% LTV?

Post: How to deal with vacant but not abandoned property?

Post: How to deal with vacant but not abandoned property?

Post: How to deal with vacant but not abandoned property?