Lemme ask you something. (Real life karma/ money)

[jnevin]

Say you knew someone that was going to lose their home and could possibly help them. You went through every option, bank, etc, that you could think of and no one could help you or them because of their status, income type, etc. You found a way to help them and keep their house, but it will cost them 10% of their outstanding loan amount and a payment rate of 13% without a prepayment penalty. Would you feel good doing this?

BTW, it is a $1.1M loan and they stand to lose $750K in equity if the bank takes the house.

 

[Subzeero]

intro physics and then that. I need a break!

 

[Lestat]

So they have 750K equity in a 1.1M home?

Why not have a fire sale, sell it for 900K, they can keep 550K of it and buy a condo.

 

[ZKaudio]

sell the damn house and walk with at least 500k. Unless you're in california you'll be fine to get another house with that... good god. Someone risking 750k in equity over poor planning needs a good hard kick in the nards.

how about you buy the house from them under distress for like 800k and contractually agree to let them live there for another year...

 

[Lestat]

sell the damn house and walk with at least 500k. Unless you're in california you'll be fine to get another house with that... good god. Someone risking 750k in equity over poor planning needs a good hard kick in the nards.

how about you buy the house from them under distress for like 800k and contractually agree to let them live there for another year...

that's how I was thinking.

If it was a friend, I'd take out a 350K loan in my name, pay off the outstanding debt on the home, and go to a lawyer and have my friend sign me over 51% ownership in the home, with a contigency that I would give him the right to buy out my portion at any time (basically once he got his credit back).

 

[ZKaudio]

you think like me. i should get u a job on my new project.

how much do you make.

 

[Lestat]

you think like me. i should get u a job on my new project.

how much do you make.

right now I pull in 80K + bonuses, but for me to leave I'd need to find a job paying 100K and up because of the benefits I get (stock options, retirement, medical, etc).

I've been offered some lucrative consulting jobs in New York that I've passed on.

What type of opportunity are you talking about?

 

[jnevin]

So they have 750K equity in a 1.1M home?

Why not have a fire sale, sell it for 900K, they can keep 550K of it and buy a condo.

No. They owe 1.1M on a 1.850M house. A house that price in Salt Lake doesn't sell as quickly as they would need it to. The bank will take it first. I found a hard money lender that will get them out of foreclosure without proving income, which is huge, for 10% of the loan amount. It's a lot of money. I personally think it's worth it, but I also just had someone tell me I'd be an asshole if I did that to someone. The money wouldn't go to me, I'd be paid a 1.5% referral fee when it closes, which doesn't suck.

 

[Subzeero]

No. They owe 1.1M on a 1.850M house. A house that price in Salt Lake doesn't sell as quickly as they would need it to. The bank will take it first. I found a hard money lender that will get them out of foreclosure without proving income, which is huge, for 10% of the loan amount. It's a lot of money. I personally think it's worth it, but I also just had someone tell me I'd be an asshole if I did that to someone. The money wouldn't go to me, I'd be paid a 1.5% referral fee when it closes, which doesn't suck.

whatever puts money in your pocket and makes your friend happy!!

 

[Lestat]

No. They owe 1.1M on a 1.850M house. A house that price in Salt Lake doesn't sell as quickly as they would need it to. The bank will take it first. I found a hard money lender that will get them out of foreclosure without proving income, which is huge, for 10% of the loan amount. It's a lot of money. I personally think it's worth it, but I also just had someone tell me I'd be an asshole if I did that to someone. The money wouldn't go to me, I'd be paid a 1.5% referral fee when it closes, which doesn't suck.

Ok, this is what I would do.

Find some gap financing/bridge loan to make payments on the home for another 6 months, so what are we talking there, 50,000.00?

That means I'm safe making payments for 6 months

During that 6 month period I'd sell the home, pay back the original mortgage and the supplemental 50K I took out and still be able to walk away with close to 700K