No Go On House 6

I heard back from the agent this morning. Ocwen was will to do a short sale, but not by that much. They will accept $20,596.95 and the original loan amount was $22,000. The payoff on the first was $96,637, for a total of $117,233, plus title fees. There isn't enough room to flip, since this comps at $121,000. Actually, it was appraised at that last year, so now you could maybe get $123,000 for it.

This would be a good rental property though. It's a 2 bedroom, 1 bath built in 1983. 950 square feet. It's got a carport and a nice backyard with a patio. It needs paint and probably carpet. One bathroom vanity needs to be replaced (or just have the footboard repaired). Some junk in the backyard needs to be hauled away - an old barbeque and the contents of a metal shed. A new roof was installed in 2000. Nice neighborhood. A house a couple doors down rents for $850 a month. This property goes to auction on 2/25, so you need to move fast if interested. If you are interested, email me at 10thAvenueInvestments at cox dot net and I'll give you the details for a tiny finder's fee.

House 6 - Part 2

Finally spoke with the listing agent a couple of hours ago. She did receive my offer and submitted it yesterday. The offer technically expired 1 hour ago, but I spoke with her and we're going to treat it as still live until we get a response. The issue is that Ocwen, a big finance company, is involved. They own the second on this house and the holder of the first is set to foreclose in 10 days. According to the agent, no one has offered enough to be able to pay off both loans, so she is currently in the process of trying to get Ocwen to accept a short sale. Since Ocwen is a large company, it takes a while for them to give a response. A short sale is really in their best interest since otherwise Ocwen would have to buy the house at auction to protect their position. Unfortunately, the Phoenix market is pretty hot right now, so Ocwen may decide to take their chances with an auction.

I'm not sure why they wouldn't accept my offer. Based on my research, my offer is $3,000 OVER the original first and second mortgages combined. Now, the loans are only 1 year or so old, so barely any of the principle will have been paid down, and there will be all kinds of late fees on the first (since that was the delinquent one), and of course, the commission for the listing agent needs to be paid. What all that means is Ocwen would probably end up losing a couple thousand or so on the deal. But I have to believe that they would lose more if it went to auction and they had to buy it, then resell it again. But, as I said, they may opt to take their chances.

House 6

I found a nice house in Phoenix that is a preforeclosure. It's scheduled to go to auction next Friday (just 10 days!). I checked the place out yesterday afternoon and faxed in an offer about 45 minutes later. I specified the deadline for a response was noon today. Due to the impending auction, we need to move fast on this one.

When I first found the property, I called the listing agent and reached her right away. I got some basic info and then visited the place myself. After that however, I have had no luck at all reaching anyone. The main office number is answered by voicemail and the cell phone number given on the message also rings through to voicemail. I've left messages at both places and no one is returning my call.

The property is a SFH that was used as a rental property. It's in fairly decent shape, but there is some work that needs to be done. At first I was super excited about the property because it looked like there was a good amount of equity. However, I later discovered a second mortgage that I overlooked. There's still enough room to make it a good deal for me and, given the timeframe involved, I should be able to get this at a decent discount. Assuming, of course, someone returns my phone calls.

House 4 Update

Just noticed the selling price on the property has dropped from $57,000 to $53,300. This is lower than the owner's counter offer to me last week, although still above my offer price. This one bears watching.

No Go On House 3

I did not have the highest bid for House 3. Don't know what the winning bid was, but my agent said, when she is asked, she never usually gives that info out. She may call the listing agent to see if she can find out, but I told her it wasn't that important. It's not like I need the info. I was just curious since this was my first auction property. I think from the selling price I might be able to tell if it was bought to be used as a flip or a rental. Anyway, the bottom line is I made the highest bid I could that would allow the property to work for me, so there is nothing wrong with losing the auction. On to the next one!

Oh.. One thing I learned. The deadline for this property was midnight on 2/14/05. This was somewhat ambiguous to me. Technically, midnight on 2/14 is one minute after 11:59 PM on 2/13. However, conversationally, most people would say "midnight 2/14" would mean one minute after 11:59 PM on 2/14. But, since I got the auction results at 9:40 AM on 2/14, that means the closing time listed for bids is really the correct usage of "midnight."