What do I do!

this is what I would do. The house has a lot of equity in it, So with so much equity in it I would go for a short sale which may take a little while for completion but there is a whole lot much money to be made. If you don't want to wait 3 to 6 months or more for the banks to accept your offer then do a wholesale but the first and most inportant thing to do is while the seller is
still highly motivated get it under contract and then maybe you could do a wholesale and still come out with maybe 5 to 15k in your pocket. You should have a buyers list by now once you get it under contract just put it out there and it will soon been gone. You could put it on craigslist,to your list of buyers,even on here, there are buyers that participate in this. So the idea
of which you have about the assignment sounds good.

subject to existing financing (so long as you can rescue it before foreclosure)! Sounds like she's had a mortgage for awhile that its paid down so much! Which means a great thing... there probably are not that many years left on the loan. Can you get $8300 to bring it current? You will be saving their credit from a foreclosure and getting a loan with A LOT of equity, meaning you are going to be paying more principal on it! And, you won't have to qualify for the loan! You may be able to get a HML (even if your credit is bad) for the $8300 since its such a small amount of equity in the home, but it would depend if there's already a second on the house.

Find out when she took the loan out, what the terms are, and interest rate, whether it has an escrow account and/or PMI. A regular bank loan, you pay more interest than principal until year 22. The longer its been pain on, the less interest you'll pay! Essentially, you're getting the house for $8300 + payments for however long you decide to keep it. Find out the cashflow on it.

Put in an offer subject to existing financing, with the down payment just being the amount of default, and the price being the amount of the loan + the costs to bring it current. Leave a clause allowing the purchase price to be flexible based upon the amount of principal due on the loan. Get all the information on the loan and have them designate you as the POC for the loan designating you the MANAGER of the property. Then you can market it and sell it for its value or hold on to it if there's a good cashflow for the expenses.

Does it need any repair?

That is definitely what I would do!

You must know what the house will sell for and what the rehab costs are to fix it up so it will sell fast. Subtract your assignment fee and what the investor needs to make. Then you will know what to offer. The numbers you listed above have NOTHING to do with whether or not this is a deal!(unless $85,000 is the actual pay off amount) If you are going to assign this deal all that matters is her pay off amount. I can't answer any of your questions until you list what actual ARV is. You must establish this by sold and currently listed comps. What is owed in total by the seller(85,000?) and what re hab costs are. If you have to pay $85,000 to stop the foreclosure and assigning is your strategy, that house should have an ARV of $145,000 and need no work at all. Any work needed will raise the ARV you need. Say it needs a $15000 re model so it will sell. You will need an ARV of at least $160,000 to assign it for $95,000. Just a little higher than 70% of ARV after repairs. That would be a strong assignment deal.

So, what is this house worth on the market, today?

Good luck and do your due diligence,
Michael Mangham
MD Home Acquisitions LLC

Folks, she may have an original loan of $136,000 and now owes $85,000 however the house is more than likely worth a lot less in todays market. We need to know what it will sell for TODAY before we can say there is any equity at all.
She could very well be upside down!

She says she wants to assign it, so if the numbers are right, get it under contract and assign it. No need to have to make up any back payments, just pay everything off at closing! Can do that for $10 earnest money. Way to simple!

Michael Mangham
MD Home Acquisitions LLC

Find out the accurate ARV! Comps within .5 miles in the same neighborhood within the last 3 months. The more comps the better! Remove the lowest and highest $/sq ft if you have enough comps; then find the average $/sq ft & multiply by the sq ft. This will give you a good idea of ARV.

If you are doing subject to, you don't need to get it as far below market because of the length of the loan. Subject to is good for buy and hold. Check rentometer.com to get an idea of how much you can get for rent.

more later. typing with one hand! If cash flow is there, equity isn't as important; but find out the amount of her payments, taxes, insurance and other expenses associated with the house.

Or, check out the thread entitle 'something really cool...', there is a great idea on there!

But, if you want a buy and hold property without qualifying for a loan (at least a major loan), this is a great way to do it, but make sure it has cashflow, or if you turn it or assign it that it has equity. How far along is she in the foreclosure process (how many months)? A short sale may not happen, so I wouldn't go that route. 1 in 15 short sales go through, unless you have a good short sale negotiator with a high track record of success. I'm biased in this though, because I feel short sales take too long and its no fun to wait on banks.

But, like Michael said, if you want to assign it, you HAVE to have an accurate repair estimate and ARV to flip it to any investor that would be interested. (check out the thread I mention, as it does have an option that may work for this situation).

She did mention assignment, but she also mentioned Subject to. Great buy and hold opportunity if its a cash flower. (unless it needs a lot of work!) EMD could be $10 with the subject to as well Homeowner is relieved of their debt and a foreclosure, buyer owns a home without needing any credit. And I said the LOAN has a lot of equity. Different than the home having a lot of equity.

With this one you can either assign it to a cash buyer or someone else who can take it subject to as well.

This is my first one like this! So I'm very new as you'll can see! The house is worth in today's market at 90,000. No she doesn't know anything about what I plan on doing! I wanted to know if I could lock it up and flip it because I don't have the 8,000 to caught it up!I was thinking that I could lock up the property and just flip it to another investor without me doing anything to it! It is a 4/2 all hardwood nice house with no repairs that are major!

This kind of reminded me of your deal that is why I even posted it on the site! This may be very simple to you but for me this is my first deal like this! Some of us are not as seasoned in the game as you are! I'm just stepping out like dean says and taking some action, and I came here to get help oor at least information about this deal!I was thinking that this was just that simple too, but a freiind of mines said that I would have to do a short sale! This has got to happen bfore the 7 of next month!

so there is no equity. How long has she had the loan? What is the interest rate, and costs. And, what can it rent for? Will she take a small promissory note with a small payment each month to cover any amounts over the ARV value? (With a short sale she'd probably get stuck with a promissory note to the bank for a much higher amount)? I'm thinking outside the box here with options, but check out my PM. It would save her from a foreclosure... cheaper than bankruptcy, and she could repair her credit in 2-3 years i/o 7 to 10! Then you can find a property to L/O to her with a sandwich lease.

Its a short sale. There is no way to do an assignment when the house is worth $90,000 and the payoff is $85,000. You could do subject 2 but you would have to bring the loan current. I would say move on to the next or turn it over to your short sale team. Nothing is impossible (well sometimes) but I would say don't try putting a round peg in a square hole.

Keep trying and congratulations on taking action. When you analyze deals that don't work you still learn something every time!!

Michael Mangham
MD Home Acquisitions LLC

The rents for a 4 bedroom are on average $1200. If the monthly costs are a lot less than this, this is still a buy and hold opportunity using OPM, or assigning the subject to to a buy and hold investor. If you can get the seller to sign a small note for the difference in price to the value, even better (monthly income to you whether you buy it subject to or assign it subject to); but not the easiest to do.

But, like Michael said, you got to learn something and you got the experience of talking with a seller in depth.

Need more info to see if a deal is feasible. The fact that she is willing to just walk away indicates she is not concerned about saving her credit. Not saying that this would work, but with the limited info you have provided, here is a possible scenario.....Get the deed subject to existing financing. Lease option it for $95,000 with a $10k option fee. Make up the $8300 in back payments out of the $10,000 option fee. Add another hundy or so to the payment on her mortgage. So you'll make $100+ cash flow monthly, $1700 from remainder of option fee, and $2,000 plus whatever the principal pay down is on the back end when the tenant/buyer exercises the option. Not a stellar deal, but if they don't exercise the option, do it again and pocket the whole $10k option fee the second time around. Or, you could just sell it on a wrap and a land contract using the down pmt to pay the back payments. I dunno, need more info.

No way a short sale is going to approve in less than a month

Well,.....unless you know the short sale administrator and you've done business with that bank and they happen to ask "how much do you need it to be..."

But thats another story

Point is as i've always said, your time is valuable and if you think its not a good deal, then its not. be proud of the effort you've put in but move on.

RE is business, never personal