OfflineI am trying to make a deal on a prop but I'm having a hard time!!! I spoke with a homeowner who's home is a pre-foreclosure and was told her balance on the mortgage is, "off hand about 350K". She has owned the home for 22 years and i have confirmed it with the county assessors website (she has a low assessed value and her property taxes are low).
But my concern is, how do i know exactly how much her mortgage balance is, in order for me to know how low of an offer i can give based on FMV and her balance? And how do i present the homeowner with what her actual balance on the mortgage is? I had it checked through a friend of mine who works in loan modifications and was told that she has two mortgages totaling 172K.
Is it possible the homeowner is not aware and thinks her balance is higher than it really is, or was i given wrong info? I would think if she did owe more or even had a 3rd mortgage it would show in the system that my friend uses to check, right?
Any help and suggestions will be appreciated!
Aris A.
From LA.
you asked how can you know how much she really owe, but then you come back and say she has 2 totaling 172k, seem like that was answered. now what you need is comps. assessed values are either too high and being contested, or they are lower than the FMV. So get the comps. Now let me explain liens, mortgages are liens that are filed with the county. If a bank don`t file a lien when they give you a mortgage, then they have no way to get their money if you default, or get the property back. so if she has a mortgage or two, then there is a lien, a paper trail.A part of Due Diligence is researching all records, or having a title company do it for you. I hope that helps you.
Jim
Hi Jim,
What I am trying to say is, should i really go by what the homeowners is saying (350K) or what i was told by a friend of mine who has access to this info (172K)? It should be up-to-date info, i would think. Or is there some other source which i can become a member or subscribe and have access to this info?
Why I'm saying this is because i had posted a similar question in the
"Freq. asked quest., start here" section and didn't get any input except for one which was: "If the owner says its 350K, then it's 350K" which didn't help me much.
Am i missing something? Is there any other way to know for sure? What records do I research and where? Will that info be given to me, or do i need an authorization from the homeowner?
I understand I need to use Due Diligence, but where do i get this info from myself?
Sorry for all the questions, but i wont be able to do this unless i ask and learn.
Some specifics on her loan:
Mortgage record #1:
Loan Amt: $50,500. Loan Type: Unknown
Mortgage Record #2:
Loan Amt: $121,000. Loan Type: Credit Line (Revolving)
Aris A.
From LA.
Jim,
When you say if there is a mortgage, then there is a lien, what needs to be done? Does the lien need to be cleared prior to transfer/assign or is that done automatically upon assigning?
Also, if the research is done by a title company, I would assume a fee would have to be paid, right?
Aris A.
From LA.
Hi Aris,
If you are reassigning the home. The new buyer/investor should cover the closing cost. Which should include doing a title search. All sales should be done subject to a title search. To clear it of any judgements or leins that one might not be aware of. Also Dean in chapter 8, recommends letting a attorney handle the closing on an assignmet deals because title companies don't have the legal capablities to make changes to the contracts. As far as getting the correct amount owed on the home from the seller. I don't understand why the seller would want to give you incorrect info, which is easily obtained from the mortgage lender in writing. They want to get out of the house. There are web sites on the internet that for a small fee will do a background check on judgements agaisnt the seller. All of this is available free from your county clerks office and liens are on file with the tax office.They are all public knowledge. So along with your comps of homes that sold in the area recently, which you can get a realtor to give you up to date. Or some web sites like zillow.com, quite a few mentioned in the book also. With this you can determine your FMV price for the purchase. Including if there is improvements to be done to the home and your fees. Make the seller aware that these terms are flexible. I hope this helps...... Much success!
Lubertha
"GOD IS STILL IN CHARGE, HE IS THE AIR WE BREATHE"
Good post Harnley.
You steered her on the right path although I am skeptical at best about a lot of those Fly-by-night Websites that offer to do background checks. If the DEAL is out of state then you may have no choice but if it is in State I would try other avenues.
I believe that the Information from some of those Background Check websites may be as old as Six Months to a Year or possibly older. Do research on the website. BBB.ORG, Attorney General in the State. Lookup the Domain Owner and see if you can determine the Company who owns it.