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Re: Approaching the owner in default.

Posted by Ward-CA- on May 19, 2001 at 8:20 AM

In Reply to: Approaching the owner of a home in default. posted by Reged on May 18, 2001 at 7:39 PM

: Ward, I attended your seminar on 5/15/01, and I was fascinated! It was my first seminar with County Records Research. I'll bring a tape recorder to the next. At the seminar, a gentleman asked you how to approach someon whose property is in default. You made comments about how your conversation would begin from the time the owner opened the door, when you gained entrance, and while you were comfortably seated in their home. You spoke about soothing the owner so that the owner would not be offended or too uncomfortable. Could you please provide me with some words of wisdom on this particular subject. Thank you in advance. See you at your next seminar!

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Reged, to answer your question, here's how I go about buying before the trustee's sale.

THE APPROACH
Don't bother wasting your time sending out mail, phoning, or placing ads. Just go out and knock on the defaulting homeowners' door.

Take your current appraisal, clipboard, pen, pencil, calculator and some scratch paper. Have one or two business cards in your breast pocket. Take a couple copies of the Equity Purchase Agreement along with its companion, Notice of Cancellation. Finally, take a few Seller's Net Worksheets.

AT THE FRONT DOOR
When the homeowner answers your knock at the front door, don't ask them, "Are you Mr. Jones?" Instead, in a presumptive tone, just state, "Mr. Jones, my name is Stuart Knight, I'm a specialist in distressed property situations, especially foreclosures. I realize that at this late date your foreclosure problem is probably taken care of. However, I wanted to stop by and make your acquaintance and let you know that if anything, and I mean anything, occurs that results in you getting less than what you were originally promised, don't feel that it's too late to do something about it. Just call my 7/24 pager, no matter how little time you have left, because I'm an expert at stopping a foreclosure almost instantly, OK? Is the deal that you've worked out still OK at this point? Are you happy with the deal you've got??? (If they say something like ". . . not really" then respond with "Well, tell me about it. Maybe we can improve on it".

If the homeowner asks you to tell her how to stop a foreclosure, tell her "I'll be happy to, but first off, let's explore the possibility of solving your foreclosure problem with a short term bridge loan OK?? So please, tell me what's causing your foreclosure, because if it's curable with a loan then I think that would be the way to go, don't you?

IF A LOAN WON'T FIX IT
"Well, now that I know what's causing the problem, I don't think another loan is the best way to go. I hate to say it, but at this point it looks like you just have two choices–either lose your house to foreclosure and totally destroy your credit, or save yourself from a 7 year credit calamity by deeding it to someone like me with the resources and commitment to cure the foreclosure. That way, all you'd have showing on your credit record is a slow pay record that would drop off in a few years."

STOPPING THE FORECLOSURE
Just filing an "emergency petition" in Chapter 13 with the bankruptcy intake clerk will immediately stop or "stay" a foreclosure in its tracks. All that's required is the filing fee and the six designated pieces of paper that make up the preliminary part of the Chapter 13 petition. The effect of filing the emergency petition close to the date scheduled for the trustee's sale is it will force the trustee to postpone their sale for at least 30 more days, since that's the earliest the bankruptcy court will hear the beneficiary's petition for relief from the borrower's automatic stay (that stopped the foreclosure process). An extra thirty days is more than enough time to consummate a sale of the property and make up the back payments to reinstate the foreclosing trust deed(s).

Hope this helps.


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