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ANTHONY6977
886 Posts |
 Posted - 07/24/2008 : 12:02:38 PM
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| Anyone know if a tenant can purchase a home that has been foreclosed on? My client is interested in purchasing the home, and is currently occupying it. The bank is trying to evict him, but he would rather stay, get his financing together and make an offer. Spoke to the reo's office and they said he MUST vacate, they dont care if he wants to buy it. Just recently the home has been served as a trustee sale for early august. Prolonging the sale? |
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Captain Mortgage
1412 Posts |
Posted - 07/24/2008 : 12:07:24 PM
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They still have to leave unless they purchase it at the trustee sale. Think of it as a buyer wanting to move in the day they open escrow. It is just not a good idea for the seller.
The good news is they can probably get cash for keys and use that money towards their deposit. |
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ANTHONY6977
886 Posts |
Posted - 07/24/2008 : 12:10:30 PM
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any other way? without having to purchase it through a trustee sale?
My tenant does not want to have to move out and then move back in. And doesnt want to have to purchase it at an auction against other parties. thanks for your 2 cents Captain |
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KHufford
5116 Posts |
Posted - 07/24/2008 : 12:10:41 PM
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quote:
Originally posted by Captain Mortgage
They still have to leave unless they purchase it at the trustee sale. Think of it as a buyer wanting to move in the day they open escrow. It is just not a good idea for the seller.
The good news is they can probably get cash for keys and use that money towards their deposit.
Yeah, that makes sense. Tell them to try to get it at the initial auction, nobody bids on these..
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Captain Mortgage
1412 Posts |
Posted - 07/24/2008 : 12:13:03 PM
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quote:
Originally posted by KHufford
quote:
Originally posted by Captain Mortgage
They still have to leave unless they purchase it at the trustee sale. Think of it as a buyer wanting to move in the day they open escrow. It is just not a good idea for the seller.
The good news is they can probably get cash for keys and use that money towards their deposit.
Yeah, that makes sense. Tell them to try to get it at the initial auction, nobody bids on these..
The only problem is that the opening bid at the auction is typically higher than the value of the home and also higher than what they will eventually list it for. |
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slants
4203 Posts |
Posted - 07/24/2008 : 12:14:09 PM
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quote:
Originally posted by KHufford
quote:
Originally posted by Captain Mortgage
They still have to leave unless they purchase it at the trustee sale. Think of it as a buyer wanting to move in the day they open escrow. It is just not a good idea for the seller.
The good news is they can probably get cash for keys and use that money towards their deposit.
Yeah, that makes sense. Tell them to try to get it at the initial auction, nobody bids on these..
Because it's cash only at the courthouse, no financing. |
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KHufford
5116 Posts |
Posted - 07/24/2008 : 12:24:33 PM
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quote:
Originally posted by Captain Mortgage
They still have to leave unless they purchase it at the trustee sale. Think of it as a buyer wanting to move in the day they open escrow. It is just not a good idea for the seller.
The good news is they can probably get cash for keys and use that money towards their deposit.
Yeah, that makes sense. Tell them to try to get it at the initial auction, nobody bids on these..
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rtrefflich
2634 Posts |
Posted - 07/24/2008 : 12:24:41 PM
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What state are you in? I do this a lot, if the tenant qualifies have them buy it on a short sale. You just need to prove that there is no relation with the tenant and owner. The bank would rather short than FC and if the tenants qualify they would be a willing buyer.
I am currently working on one of these now in San Diego. |
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ANTHONY6977
886 Posts |
Posted - 07/24/2008 : 12:27:47 PM
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| Property is in ca. The home has already been foreclosed on the homeowner. Tenant wishes to stay in the property and purchase it. |
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slants
4203 Posts |
Posted - 07/24/2008 : 12:31:18 PM
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quote:
Originally posted by ANTHONY6977
any other way? without having to purchase it through a trustee sale?
My tenant does not want to have to move out and then move back in. And doesnt want to have to purchase it at an auction against other parties. thanks for your 2 cents Captain
Not an option. He may not successfully purchase it anyway so planning to move BACK in is way premature. The foreclosing lender cannot negotiate the sale of property they do not yet own, and if and when they do, they may not decide to offer it to the public for resale where it would even be available for him to buy. After they recover the property, they may end up wholesaling it in a pool to investors and never list it on the retail MLS. If they do list it, they will want it vacant and available for showings. |
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rtrefflich
2634 Posts |
Posted - 07/24/2008 : 12:33:22 PM
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If the home has already been FC upon there is nothing he can do, he MUST leave
quote:
Originally posted by ANTHONY6977
Property is in ca. The home has already been foreclosed on the homeowner. Tenant wishes to stay in the property and purchase it.
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slants
4203 Posts |
Posted - 07/24/2008 : 12:33:42 PM
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quote:
Originally posted by ANTHONY6977
Property is in ca. The home has already been foreclosed on the homeowner. Tenant wishes to stay in the property and purchase it.
If the sale date is in August, then the foreclosure proceeding has started, but it has not been foreclosed, yet. With a qualified offer, they may agree to postpone the sale to allow the shortsale to close, or not. Richard is right. That would be the only way. |
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rtrefflich
2634 Posts |
Posted - 07/24/2008 : 12:42:02 PM
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I caught that too, either the FC has happened or has not. If it is in August we can get it postponed. We have a lot of experience working SS so if the house is not already listed and you are interested give me a call at 562-209-3816. If the house is listed, talk to the listing agent.
toquote:
Originally posted by slants
quote:
Originally posted by ANTHONY6977
Property is in ca. The home has already been foreclosed on the homeowner. Tenant wishes to stay in the property and purchase it.
If the sale date is in August, then the foreclosure proceeding has started, but it has not been foreclosed, yet. With a qualified offer, they may agree to postpone the sale to allow the shortsale to close, or not. Richard is right. That would be the only way.
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LoanDiva01
52 Posts |
Posted - 07/24/2008 : 2:45:05 PM
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quote:
Originally posted by ANTHONY6977
Property is in ca. The home has already been foreclosed on the homeowner. Tenant wishes to stay in the property and purchase it.
One thing won't have anything to do with the other. Depending on the lender, the eviction is going to happen, it's a matter of how quickly. That's going to crash buyer's credit. The bank will likley send someone to offer the tenant a few bucks to get out without a fuss.
Just because the bank has it does not mean they are going to sell it today. They will have it in pre list with a local broker while they collect BPO's, an appraisal & do some damage assessment.
Call around to some of the local agents who handle a lot of REO to see who has it in pre list & work with that agent.
That's pretty much all you're likely to be able to do. Banks don't have the resources to talk to every individual buyer who may be interested in a property. Once they have the unit back, they hand it over to an asset management company who assigns it to a local broker.
You can also track it via the lender's web site, most of the larger lenders maintain REO lists on their web sites.
But get the buyer out before they wreck their credit.
The REO process from gavel falling till it's actually listed & on the market takes time. How much time depends on who the lender is. Some are on top of it & start the process right away including the eviction.
Buying at the foreclosure auction would be the worst idea ever. It's overpriced for cryin out loud otherwise seller would have sold the danged thing & been done with it. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:09:32 PM
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| This is how I bought my house, and I never moved out of it. |
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slants
4203 Posts |
Posted - 07/24/2008 : 3:11:09 PM
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quote:
Originally posted by eryan2369
This is how I bought my house, and I never moved out of it.
Did you buy it from the lender or the previous owner in a shortsale? |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:12:00 PM
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| I bought it from the bank (lender) that FC'd |
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slants
4203 Posts |
Posted - 07/24/2008 : 3:13:28 PM
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quote:
Originally posted by eryan2369
I bought it from the bank (lender) that FC'd
So they let you live there during escrow after they foreclosed it? What's the story? |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:23:24 PM
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quote:
Originally posted by slants
quote:
Originally posted by eryan2369
I bought it from the bank (lender) that FC'd
So they let you live there during escrow after they foreclosed it? What's the story?
I was living there as a renter (renting from a friend who owned it) and my buddy who owned the house lost his job, went into bk and had already told me "he was going to have to loose the house."
They delivered the foreclosure letter to the house certified and I called the lady at the bank in the "special assets" department (their way of saying it without calling it the foreclosure dept) and I told her I was living in the house as a renter and was interested in buying it. She told me the by law they had to hold a public auction and could not sell it to me without doing that. But I was never told to move out, there was never any notice to vacate or anything.
I kept in contact with the lady at the bank and went to the auction on the courthouse steps...sat there all day looking like a dumba**. No one else was there when the attorney came to auction the property so I just didnt bid, and I immediately called the bank back afterward and told them no one else showed up to bid. So I asked if I could just fax over an offer, I even asked "I know you work for the bank, but if you were going to make an offer on this, what would you offer"...just to test the waters (I really didnt expect an answer). And the bank employee actually told me "I would offer about 75% of the payoff amount that was listed on the letter and was the starting bid amount at the auction".
So the next day I faxed an offer over for 75% of the payoff + $1. She called me back within an hour and said "its yours, I just need 3% within 24hrs and you have 30 days to get us the balance". |
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LoanDiva01
52 Posts |
Posted - 07/24/2008 : 3:24:31 PM
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Uh, this is in CA, not AL.
The process is different here. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:25:58 PM
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quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
Im sure it is...everything else is. |
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slants
4203 Posts |
Posted - 07/24/2008 : 3:26:56 PM
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quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
How so? The bank agreeed to sell it to him immediately following the trustee's sale. It had nothing to do with state foreclosure procedures, but bank procedures. Which lender was it? |
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crankyusi
396 Posts |
Posted - 07/24/2008 : 3:27:46 PM
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quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL. The process is different here.
I'd like to hear the story though, regardless of location, could learn something. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:28:35 PM
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quote:
Originally posted by slants
quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
How so? The bank agreeed to sell it to him immediately following the trustee's sale. It had nothing to do with state foreclosure procedures, but bank procedures. Which lender was it?
A local bank, no one you've ever heard of unless you live in N. Alabama |
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crankyusi
396 Posts |
Posted - 07/24/2008 : 3:29:26 PM
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quote:
Originally posted by eryan2369
quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
Im sure it is...everything else is.
Some highlights would be appreciated though Eryan, may help sometime, ya never know. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:31:05 PM
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quote:
Originally posted by crankyusi
quote:
Originally posted by eryan2369
quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
Im sure it is...everything else is.
Some highlights would be appreciated though Eryan, may help sometime, ya never know.
Scroll up, I gave the whole story. |
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slants
4203 Posts |
Posted - 07/24/2008 : 3:31:27 PM
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quote:
Originally posted by eryan2369
quote:
Originally posted by slants
quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
How so? The bank agreeed to sell it to him immediately following the trustee's sale. It had nothing to do with state foreclosure procedures, but bank procedures. Which lender was it?
A local bank, no one you've ever heard of unless you live in N. Alabama
That's the MAJOR reason here. The means by which a lender acquires title to the property through foreclosure may vary state to state, but once they do recover the house, it's theirs to do with as they please. A small private bank would make decisions that a large national lender would not. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:34:01 PM
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quote:
Originally posted by slants
quote:
Originally posted by eryan2369
quote:
Originally posted by slants
quote:
Originally posted by LoanDiva01
Uh, this is in CA, not AL.
The process is different here.
How so? The bank agreeed to sell it to him immediately following the trustee's sale. It had nothing to do with state foreclosure procedures, but bank procedures. Which lender was it?
A local bank, no one you've ever heard of unless you live in N. Alabama
That's the MAJOR reason here. The means by which a lender acquires title to the property through foreclosure may vary state to state, but once they do recover the house, it's theirs to do with as they please. A small private bank would make decisions that a large national lender would not.
Agreed, there would prob be much more red tape and required procedures at a national lender. This local bank more or less had one person in charge of their foreclosure's with full authority it seemed. |
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crankyusi
396 Posts |
Posted - 07/24/2008 : 3:36:04 PM
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quote:
Originally posted by eryan2369
Scroll up, I gave the whole story.
Thanks Eryan2369, and congrats. |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 3:39:55 PM
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quote:
Originally posted by crankyusi
quote:
Originally posted by eryan2369
Scroll up, I gave the whole story.
Thanks Eryan2369, and congrats.
Thanks...I didnt really tell you the best part...
My friend had bought this property as a HUD foreclosure 5 years before (it was on a 5 year balloon, thats why he lost it, his credit was too far gone to refi when it popped) and he had gotten it for a steal. Plus he had already done the majority of remodel work, new carpet, new paint, new countertops, etc...
So the payoff amount was extremely low and the house had already been mostly remodelled. So I got it for 75% of the already low payoff with the improvements already completed out of someone elses pocket. I basically can more than double my money on it in a few months. |
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LoanDiva01
52 Posts |
Posted - 07/24/2008 : 3:50:43 PM
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Here in So Cal the sheer volume of REO makes it impossible for lenders to deal with individual buyers.
And at the trustee's sale, the bank would have bought it back. We don't do judicial foreclosures here on purchase money DOTs. Best you could hope for was to pull off a short sale. I wish anyone all the luck in the world with that once it's close to acution.
A hometown bank in AL is a bit different than CA.
I sell REO all day long & if anyone advises that tenant to stay put that is horrible advice & the tenant is going to end up with wrecked credit.
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slants
4203 Posts |
Posted - 07/24/2008 : 4:05:21 PM
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quote:
Originally posted by LoanDiva01
Here in So Cal the sheer volume of REO makes it impossible for lenders to deal with individual buyers.
And at the trustee's sale, the bank would have bought it back. We don't do judicial foreclosures here on purchase money DOTs. Best you could hope for was to pull off a short sale. I wish anyone all the luck in the world with that once it's close to acution.
A hometown bank in AL is a bit different than CA.
I sell REO all day long & if anyone advises that tenant to stay put that is horrible advice & the tenant is going to end up with wrecked credit.
The local bank in AL DID buy it back because no buyer was there to bid on it, which was how they obtained the right to resell it to the tenant immediately after the trustee's sale. However, it is unlikely a large bank would handle the property as the local bank did. Lenders will postpone trustee's sales to accommodate shortsales. We got a 30 day extension from CW a week before sale date to alow a shortsale to close. BTW, AL is a nonjudicial foreclosure state just like CA. I don't think anyone advised the tenant to stay and wait for eviction post foreclosure. Does eviction even show up on one's credit anyway? I've never seen one. They'd probably have a bad mark on the rating system landlords use if trying to rent again, but does it show up on the credit bureaus? |
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eryan2369
694 Posts |
Posted - 07/24/2008 : 4:31:48 PM
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quote:
Originally posted by slants
quote:
Originally posted by LoanDiva01
Here in So Cal the sheer volume of REO makes it impossible for lenders to deal with individual buyers.
And at the trustee's sale, the bank would have bought it back. We don't do judicial foreclosures here on purchase money DOTs. Best you could hope for was to pull off a short sale. I wish anyone all the luck in the world with that once it's close to acution.
A hometown bank in AL is a bit different than CA.
I sell REO all day long & if anyone advises that tenant to stay put that is horrible advice & the tenant is going to end up with wrecked credit.
The local bank in AL DID buy it back because no buyer was there to bid on it, which was how they obtained the right to resell it to the tenant immediately after the trustee's sale. However, it is unlikely a large bank would handle the property as the local bank did. Lenders will postpone trustee's sales to accommodate shortsales. BTW, AL is a nonjudicial foreclosure state just like CA. I don't think anyone advised the tenant to stay and wait for eviction post foreclosure. Does eviction even show up on one's credit anyway? I've never seen one. They'd probably have a bad mark on the rating system landlords use if trying to rent again, but does it show up on the credit bureaus?
Im not sure if "eviction" is even the right term here. If he was renting from the individual, and the individual got foreclosed on...there is nothing connecting the renter to the bank that forecloses. The renter has no agreement or debts with the bank, only the landlord, so unless the landlord evicts there is no wrong on the part of the renter. But if the bank takes control of the property and someone is living in it they basically can see that as a "squatter" with no legal right to be there and have that person served a notice to vacate. But I dont think there is any way that can go against the renters credit, heck, the bank doesnt even have the personal info of the renter in this situation, ie; name, social sec number, dob, etc. to put it on the renters credit...unless im misunderstanding your debate? |
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slants
4203 Posts |
Posted - 07/24/2008 : 4:40:40 PM
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quote:
Originally posted by eryan2369
Im not sure if "eviction" is even the right term here. If he was renting from the individual, and the individual got foreclosed on...there is nothing connecting the renter to the bank that forecloses. The renter has no agreement or debts with the bank, only the landlord, so unless the landlord evicts there is no wrong on the part of the renter. But if the bank takes control of the property and someone is living in it they basically can see that as a "squatter" with no legal right to be there and have that person served a notice to vacate. But I dont think there is any way that can go against the renters credit, heck, the bank doesnt even have the personal info of the renter in this situation, ie; name, social sec number, dob, etc. to put it on the renters credit...unless im misunderstanding your debate?
Right debate, but eviction is correct here. Pretty sure your Deed of Trust allows for the Assignment of Rents. Once foreclosed, the lender becomes the new landlord and inherits the same rights and responsibilities of the landlord. The lender will pursue "eviction", an Unlawful Detainer law suit in CA, if tenant does not voluntarily vacate with a 30 Notice to Quit. The suit will name the former owner and "occupants", but not necessarily the tenants by name. So I agree with your logic that it cannot affect the tenant's credit since the eviction proceeding is actually filed against the previous owner. |
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tropixman
82 Posts |
Posted - 07/24/2008 : 5:15:22 PM
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| The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out. |
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ANTHONY6977
886 Posts |
Posted - 07/24/2008 : 5:17:55 PM
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| Okay, the home has been foreclosed on already. Its set up to be sold at auction on a trustee sale. Confirmed it with title that the foreclosure has been recorded. My client wants to buy the, does not want to vacate and have to move back in. |
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slants
4203 Posts |
Posted - 07/24/2008 : 5:29:03 PM
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quote:
Originally posted by ANTHONY6977
Okay, the home has been foreclosed on already. Its set up to be sold at auction on a trustee sale. Confirmed it with title that the foreclosure has been recorded. My client wants to buy the, does not want to vacate and have to move back in.
I think you are very confused. If a trustee's sale has not occurred, that means a Notice of Default has been filed and recorded and the foreclosure process has begun, but foreclosure will not be concluded until it is sold at trustee's auction in August (4 months+ process). At that time, the tenant will have to move or be evicted. He may or may not be able to buy it after the trustee's sale, that's not his call. Lender may not want to sell it to him and may opt to sell it to one of their investors or another buyer post foreclosure. Regardless whether he gets the opportunity to attempt to buy it, staying there to find out will not be an option. His only chance of not moving and buying it is to complete a shortsale from the homeowner with the lender's approval prior to the trustee's sale. You should contact Richard for assistance to work up a shortsale. |
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slants
4203 Posts |
Posted - 07/24/2008 : 5:35:07 PM
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quote:
Originally posted by tropixman
The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out.
The problem with chapter 13's is that the homeowner must resume making regular mortgage payments that they couldn't pay before or the petition will be dismissed. |
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tropixman
82 Posts |
Posted - 07/24/2008 : 5:44:34 PM
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quote:
Originally posted by slants
quote:
Originally posted by tropixman
The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out.
The problem with chapter 13's is that the homeowner must resume making regular mortgage payments that they couldn't pay before or the petition will be dismissed.
The Chapter 13 would not be used to get the homeowner back on track with his mortgage payments which is up to the judge to decide after he goes to court. It provides temporary relief and is used to stop the trustee sale so the tenant could work something out with the current owner and lender. This would give them the time they need. |
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slants
4203 Posts |
Posted - 07/24/2008 : 6:07:20 PM
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quote:
Originally posted by tropixman
quote:
Originally posted by slants
quote:
Originally posted by tropixman
The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out.
The problem with chapter 13's is that the homeowner must resume making regular mortgage payments that they couldn't pay before or the petition will be dismissed.
The Chapter 13 would not be used to get the homeowner back on track with his mortgage payments which is up to the judge to decide after he goes to court. It provides temporary relief and is used to stop the trustee sale so the tenant could work something out with the current owner and lender. This would give them the time they need.
The payments are not back payments to get back on track with the mortgage, but resuming new payments and staying current during the filing are required before the Chapter 13 is even confirmed by a judge. Someone I know very, very well filed Chapter 13 to forestall a pending trustee's sale, but her case got dismissed because she was unable to resume the $4,500 a month payment and maintain it while the petition was still pending. |
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tropixman
82 Posts |
Posted - 07/24/2008 : 7:38:59 PM
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quote:
Originally posted by slants
quote:
Originally posted by tropixman
quote:
Originally posted by slants
quote:
Originally posted by tropixman
The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out.
The problem with chapter 13's is that the homeowner must resume making regular mortgage payments that they couldn't pay before or the petition will be dismissed.
The Chapter 13 would not be used to get the homeowner back on track with his mortgage payments which is up to the judge to decide after he goes to court. It provides temporary relief and is used to stop the trustee sale so the tenant could work something out with the current owner and lender. This would give them the time they need.
The payments are not back payments to get back on track with the mortgage, but resuming new payments and staying current during the filing are required before the Chapter 13 is even confirmed by a judge. Someone I know very, very well filed Chapter 13 to forestall a pending trustee's sale, but her case got dismissed because she was unable to resume the $4,500 a month payment and maintain it while the petition was still pending.
I know it is not a permanent solution but I'm sure it would give them enought time to work out something between all parties.
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slants
4203 Posts |
Posted - 07/24/2008 : 7:43:53 PM
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quote:
Originally posted by tropixman
quote:
Originally posted by slants
quote:
Originally posted by tropixman
quote:
Originally posted by slants
quote:
Originally posted by tropixman
The tenant could have the current owner consult with an attorney about a Chapter 13 which would stop the trustee sale and then buy the property directly from the owner. He could also possibly negotiate a short payoff from the lender. The lender would probably agree due to market conditions. It's a WIN WIN for everyone. Your client, the tenant, would not have to move out.
The problem with chapter 13's is that the homeowner must resume making regular mortgage payments that they couldn't pay before or the petition will be dismissed.
The Chapter 13 would not be used to get the homeowner back on track with his mortgage payments which is up to the judge to decide after he goes to court. It provides temporary relief and is used to stop the trustee sale so the tenant could work something out with the current owner and lender. This would give them the time they need.
The payments are not back payments to get back on track with the mortgage, but resuming new payments and staying current during the filing are required before the Chapter 13 is even confirmed by a judge. Someone I know very, very well filed Chapter 13 to forestall a pending trustee's sale, but her case got dismissed because she was unable to resume the $4,500 a month payment and maintain it while the petition was still pending.
I know it is not a permanent solution but I'm sure it would give them enought time to work out something between all parties.
Assuming owner can pay the attorney fee and resume making payments within 15 days of filing, but very expensive considering he wants to let the property go. Shortsale with an extension on the sale date is really the only option. |
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rtrefflich
2634 Posts |
Posted - 07/25/2008 : 12:41:23 AM
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State of CA just passed a law indicating that when a bank FC the tenant has 60 days to move out, after that the bank may begin the eviction process. If evicted, the eviction would not show up on a tenants credit unless the bank were to report it. The bank would not even have the name, social or other relevant info to report it to the credit unless the bank collects it from the tenant (which unless the tenant gives it to them is not going to happen).
As mentioned above, the house either has already been foreclosed upon, indicating that a trustees sale has already occurred and the bank is not the owner of record (or the person who bought the property at trustees sale), or an NOD has been filed indicating that 3 months from the date of the NOD is the soonest they can have the trustees sale.
The only option your tenant would have is to approach the bank with a short sale offer, meaning that if the owner owes $500K, and properties in the area are going for $300K, your tenant will be willing to purchase the property for $300K or so. The judicial foreclosure process will cost a ton of money (excluding a bankruptcy by the owner or eviction proceedings for the tenant) and the bank will then put it on the market for $300K, which is exactly what they will get right now for the home without paying all the money to the foreclosing attorney. it is a win-win for all, and in reality, your tenant may get the home cheaper than he ever would after it is foreclosed upon.
If the NOD has been filed, it is not too late to submit an offer to the bank to get the short sale process going. As Helen has indicated above, banks are always willing to postpone the Trustees sale if they have an offer in hand for a short sale, because in the long run they will save money. Just got one postponed from July to Sept. as we are running the short for one client. |
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LoanDiva01
52 Posts |
Posted - 07/25/2008 : 08:50:02 AM
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Banks are not *always* willing to postpone a trustee's sale!!!!!!!!!!!!
I've seen plenty go on the chopping block with a short sale pending. One dept doesn't always know what the other is doing.
You can't start a short sale all in one day. The owner has to jump through a lot of hoops, prove hardship, request a short sale package, etc. Buyer had better be pre approved & ready to go.
As for the new 60 day rule, has that actually passed or is it still just kicking around? I am not seeing it enforced locally by the courts. |
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rtrefflich
2634 Posts |
Posted - 07/25/2008 : 08:55:04 AM
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Yes, you are correct, they will more times than not if they have a willing and able buyer. In addition, filing a BK (just the filing process) will also stay the FC.
Our turn around time to get the SS "started" is usually within 72 hours, some banks are better than others. It is the process after getting the initial contact with the bank that takes forever.
As far as the law, the Governator signed it into law about a week to 10 days ago.
quote:
Originally posted by LoanDiva01
Banks are not *always* willing to postpone a trustee's sale!!!!!!!!!!!!
I've seen plenty go on the chopping block with a short sale pending. One dept doesn't always know what the other is doing.
You can't start a short sale all in one day. The owner has to jump through a lot of hoops, prove hardship, request a short sale package, etc. Buyer had better be pre approved & ready to go.
As for the new 60 day rule, has that actually passed or is it still just kicking around? I am not seeing it enforced locally by the courts.
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jbelman
237 Posts |
Posted - 07/25/2008 : 09:41:14 AM
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quote:
Originally posted by ANTHONY6977
Anyone know if a tenant can purchase a home that has been foreclosed on? My client is interested in purchasing the home, and is currently occupying it. The bank is trying to evict him, but he would rather stay, get his financing together and make an offer. Spoke to the reo's office and they said he MUST vacate, they dont care if he wants to buy it. Just recently the home has been served as a trustee sale for early august. Prolonging the sale?
Yes you can definetly buy this property way before all bidders. What you do is you contact the lender who foreclosed. They have an asset management team assigned to the account. Usually its on the eviction notice who is evicting you.Call them and let them know. 95% of all my deals with properties beeing foreclosed the tennats end up in buying them. If your a Realtor make sure to send a contract to get paid if owner well make sure to indicate its a FSBO :) Good LUCK |
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zpaperkid
43 Posts |
Posted - 07/25/2008 : 10:12:35 AM
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My best Buddy who rents has told me that his landlord has dissapeared from the face of the earth! So I told him to go to the County bldg, & see if NOD filed yet. (Calif.)
The house sits on about 5 acres, is 3 BR, 1 bath and has many code violations & could be redlined if the County inspected it. He is very good with construction skills, and could fix it up no problem. To me, it looks like a short sale waiting to happen! It easily could come in way below market value, say $ 200 K.
I feel he should hire a home inspector, have Gen. Contractor give bid on repairs, and arrange a HM rehab loan & make offer to bank. He is a SE Self employed construction guy, needs a stated or no doc deal. Credit decent. Has $$$ in bank, assets.
The other story is that he does a lot of work for a RE lady who lives in Idaho, and is WALKING on seven rentals in his area. Somehow, I think he could end up with a decent house in that scenario, as he is tight with her.
I would appreciate any input as to what he should do.
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