The house is in forclosure and the auction is in 2 weeks. 1st mort. 177,000 2nd mort. 96,000 (Different bank)
attorney fees 5500
Total debt--278500
FMV of house 295000
1st question --do you think there is enough time to work this deal?
2nd--Do you think the banks will negotiate on this.
The house has been on the market s for over 2 months -no takers.
On this you will prob be better off buying it at the sale as there seems like a decent spread even after the first. I would say that second will likely get wiped at the sale as I doubt they would bid to protect their interests. I am guessing that it is the first that is foreclosing.
Thank You for your response
Yes, the first is the one that is foreclosing and the second currently is in the process of foreclosing.
You think the auction is a better way to get the property?
I was figuring on paying off the first and shorting the second to avoid any competition at the auction if there was any. I wasn't sure what the banks would accept. Whats is the average a second mortgage holder would accept 30 cents on the dollar or is it more or less?
How much time does it normally take to complete a short sale from start to finish?
Any other ideas are appreciated.
I just got a $42k 2nd for 8%, and some do better. But there's not really enough time to short both, so buying it at the sale may be your best bet, unless there's too much competition. But...if CT has a redemption period, be aware that even though the second won't redeem, they have standing to do so, which encumbers the title, which would make selling with clear title difficult until the redemption period ends.
You have time to prepare and submit a short sale offer. We have successfully had sales dates extended the day before the auction. In most cases the bank would much rather sell you the house then foreclose. If they find your offer reasonable enough to mitgate loss then they will most likely extend the sales date to review and respond to your offer. If you wait till it becomes an REO then you will more than likely pay more for the property because the bank has incurred more loss. Good luck
[ Edited by jackbenimble on Date 02/07/2008 ]
Thanks to everyone for their help.