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2nd Mort question - http://www.dealmakerscafe.com Forums

Original message

RobertNM

"2nd Mort question" , Sun 5 Nov 15:42

I just took title to a property. great house! 1st is in default, Has 2nd that is current. Should I let the man continue with payments or try to call 2nd and settle for discount. What is a good place to start negotiation on a 11,000 2nd note.

p.s 2nd did not show up on foreclosure paperwork at courthouse. does this matter?

Robert in NM

Replies:

TJack

"Need more info.!!!" , Sun 5 Nov 16:54

Let the man continue with payments? On the second? Did you take title subject to? Some missing links here! Please be more specific.
TJack

RobertNM

"Re(1):Need more info.!!!" , Sun 5 Nov 21:03

Sorry,
I took title subject to. When I did the research on the foreclosure downtown, I did not find the 2nd at that time. I contacted the owner and took title subject to 1st. found out he is now 100% financed with a 2nd from Money store. The 1st is in default 5 mo. 2nd is current. Owner expressed he was going to make payments on 2nd but had thought about filing Chpt 7. What would that do to my deal? This is a new one for me, not sure how to protect myself in this situation.

Robert in NM

TJack

"Re(2):Need more info.!!!" , Sun 5 Nov 23:07

He won't make the payments on the second so if you bring the first current you'll be stuck with the second also. Will they discount...I doubt it but you never know till you try. I would only do this deal if... 1)the second will discount 2)there will be sufficient cash flow if/when the second does discount.

TJack

lynn
Moderator

"Whoooooo!" , Sun 5 Nov 22:36

......

$75.00. That's what we pay for a title search, and it's worth every cent. A title search would've uncovered this second mortgage and other liens that you may not know about.

DAMAGE CONTROL
Have you already bailed the first out of foreclosure?

Have you filed your deed?

You have to decide whether this deal is still worth it assuming that YOU are paying the 2nd. Don't kid yourself and think that the seller is going to pay it! Also, don't assume that the 2nd is current. I find it hard to believe that the first is five months behind, but the seller is paying the second.

The chapter 7 won't hurt you, but it may uncover the fact that he sold the property to you.

If you still want to proceed - Get a title report! Don't spend another dime until you get the title report. There may be other problems that you don't know about.

Happy Investing!
Lynn

RobertNM

"Re(1):Whoooooo!" , Mon 6 Nov 01:07

Lynn,
Have not filed deed, and have not cured default on first yet. Just took deed on Saturday. I took his most recent statement with money store (2nd) and was current. WEIRD! Usually, I go after foreclosures with 1st Mort. only. Thought I'd try something new I learned in Denver. HeHeHe If I have to pay the 2nd, I will have probobly a 50-100 cashflow. Looks like my deal is in the 2nd discounting. I'll let you know on this one, thanks for the answers.

Robert in NM

lynn
Moderator

"Re(2):Whoooooo!" , Mon 6 Nov 10:02

Remember that to get the second to "discount" you have to pay them off. Are you prepared to do that?

Lynn