Below is my response to Dorothy regarding her FHA deal.
Lesson learned – Sometimes you need to let a deal go.
I’ll comment more after you read my response to Dorothy.
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Dorothy,
Wow. I wouldn’t touch this one.
Of all the deals I’ve ever done, I have NEVER seen a title as messed up with liens and judgements as that one!
My suggestion would be to find another deal.
To answer your questions…
FHA is going to require their NET proceeds to be no less than 88/86/84% of the appraised value. With all the tax and judgements, this property is WAY over levereged, and trying to negotiate all those liens will be a nightmare, and your odds of getting them done are so slim, that it just isn’t worth your time.
Let this one go to sale and find another deal. There are plenty!
BTW, great to hear from another North Carolina investor!
- Marty
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Early in my short sale career, I was really struggling. I had about 6 deals I was working, all of which seemed to be “stuck in the muck” (that’s a quote from my 3 year old’s book). All the deals would provide minimal profit and were requiring maximum effort (if they closed… and a big IF). I finally got frustrated and dropped EVERY deal… yep, I let them all foreclose. I did it to clear the air and start fresh. Guess what happened. 4 months later I started closing 3-5 deals per month averaging $10,000 to $15,000 per deal.
How did that happen?!!?!??!?
I’m a big believer in Karma, Energy, or whatever you want to call it. I believe that by clearing the air, it opens the door for more and better things to come. That’s exactly what happened in this case.
How do you apply this? If you are working deals that you are not sure about, ask us about them. We’ll be happy to help you. Of course, you probably already know the answer. What does your gut say about it? If it look, smells, and tastes like a bad deal, then it probably it. It’s ok to let it foreclose. Think of all the other homeowners you’ll be helping by letting this bad deal go (by the way, the ones you “let” foreclose are probably going to foreclose anyway… so don’t think that you’re “giving up” on that homeowner. You only can do what the foreclosing bank will let you do. Ultimatley it’s the banks decision to foreclose, not yours.
I hope this help! Have a great weekend!
Marty Schulting
Top Foreclosure Training
Accelerated Loan Mods
Co-Founder and Coach
