Ok folks, here's one of my latest leads...
Got a call from a guy that wants to stay in his house. This guy makes $12 an hour and he got a loan for zero down at 8% interest! Crazy! He bought way too much house and now he's in trouble..
Property: 133k Bought in Nov 2004
Owes: 133k +4k closing costs+ ?arrears
Repairs: needs a new roof
This is an awesome red brock house right down the street from one of my other properties. This would be good one. He's pretty much upside down.
Unfortuanately, There's not much equity. My new strategy won't work becuase his payment is $1200 which is $300 over current rent comps. So, if he didn't work out and I evicted him, I would take on a huge negative cash flow. Not good !
At first, I didn't think there was much hope for him, however, I have a plan that will work. I will offer to do a short sale. If this works, I can buy the property w/ 20% equity which will give a monthly payment that will reach current market rent. He will like this because he will now have to pay only $950 a month in rent.
This will not be an easy short sale because the note is so new and the house is not really trashed. We will need to work fast because its gone in August through a trustee sale. I haven't done a short sale in over a year so this will be a good one.