Let’s get something straight, money for nothing and being underwater are catchy, attention grabbing headlines and excuses for defaults. Firstly, if you do not intend on selling, refinancin­g or running an equity line on your home, what difference does it make if CURRENTLY you owe more on your home than the market price today. If/when the market rebounds, so too will your equity stake. If it does not, that’s the risk part of real estate investing. Otherwise, its about homeowners­hip which has little to do with real estate speculatio­n. Most people owe much more on their car than its worth, do you see them just leaving them on the side of the road and walking away or refusing to make their payments with that as a justificat­ion?? Markets go up, markets go down otherwise they wouldn’t be a market. All the inflated profit that was received during the bubble wasn’t being complained about, so you can’t b*tch about it if you got caught without a chair when the music finally stopped.

When a property gets foreclosed on, and it's the first lien holder that is doing the foreclosing, then the second and third and fourth (etc.) will get wiped out at the foreclosure auction. What an investor will do is to buy/tie up the property from the defaulting owner and see if he can discount the first and second. The second will most likely agree to a small amount (usually 7-10 percent) because they will lose everything once the property gets foreclosed on. The first will usually accept a 20 percent hit.

Now what you quoted is that the second note holder was stating that he will own the property by buying it from the person in default and take over the first position's loan payments and make it current. Therefore, he is not interested in selling his note to the investors. The investors in that example were idiots for not controling the property first or the owner didn't want to sell. The investors were hoping to buy the second note at a discount and bid at the auction and own the property with at least 15 k equity plus whatever the homeowner had in equity.

You can buy any note by approaching the lending institution that holds the note and making an offer to buy it. You will need cash to do so.

Also, to clear up the quoted reference, you can purchase property "subject to" existing liens/loans. Taking property "subject to" means that you will take over the payments, but the old owner is still responsible for the loan(s). So if you stop paying the mortgage/trust deed, the lending institution will go after the old owner and start foreclosing on the property. Buying property "subject to" existing loans is one way where someone with no money and/or credit can get into a home and own it. The second note holder was buying the property from the defaulting owner using the "subject to" clause.

I either confused you or helped you. Either way, I just saved you hundreds of dollars in late night real estate infomercials!

E-mail me if you have any questions.

Regards

use the "Other" category

Nice idea of making a flirty apron. This could be a great gift for moms like last blog ..Real Estate Investing

use the "Other" category

When a property gets foreclosed on, and it's the first lien holder that is doing the foreclosing, then the second and third and fourth (etc.) will get wiped out at the foreclosure auction. What an investor will do is to buy/tie up the property from the defaulting owner and see if he can discount the first and second. The second will most likely agree to a small amount (usually 7-10 percent) because they will lose everything once the property gets foreclosed on. The first will usually accept a 20 percent hit.

Now what you quoted is that the second note holder was stating that he will own the property by buying it from the person in default and take over the first position's loan payments and make it current. Therefore, he is not interested in selling his note to the investors. The investors in that example were idiots for not controling the property first or the owner didn't want to sell. The investors were hoping to buy the second note at a discount and bid at the auction and own the property with at least 15 k equity plus whatever the homeowner had in equity.

You can buy any note by approaching the lending institution that holds the note and making an offer to buy it. You will need cash to do so.

Also, to clear up the quoted reference, you can purchase property "subject to" existing liens/loans. Taking property "subject to" means that you will take over the payments, but the old owner is still responsible for the loan(s). So if you stop paying the mortgage/trust deed, the lending institution will go after the old owner and start foreclosing on the property. Buying property "subject to" existing loans is one way where someone with no money and/or credit can get into a home and own it. The second note holder was buying the property from the defaulting owner using the "subject to" clause.

I either confused you or helped you. Either way, I just saved you hundreds of dollars in late night real estate infomercials!

E-mail me if you have any questions.

Regards

You're a decade late for that particular bogeyman.