Profile picture for user8977069

Taking over a mortgage?

I have seen many situations where a client may take over the mortgage on a foreclosure. What exactly does this mean? I am tired of rentals and looking for an investment. I do not have a substantial amount of money to put down on a home so this seems to be the ideal situation.

  • April 01 2013 - Denver
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Answers (6)

Best Answer

If the new home will be for your primary residence look into a program called CHFA to see if you would qualify for it and they would only require you to have $1000 into the transaction.


  • April 01 2013
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In order to obtain financing on a property with little money down you will have to sign at closing an agreement that says you will live ion the home for at least 1 year. So if you are planning on buying a home then right away turing it into a rental then your are out of luck unless you find a private investor.
There are a few different programs for little money down. If you would like to knoww more feel free to contact me through my profile.
  • April 03 2013
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Profile picture for user8977069
Nic, 

I am looking to stay in the range of 50-100k. Something I can obtain an affordable mortgage and rent the property to have a secondary income. As far as cash on hand goes I do not have much, Maybe 2-3k tops. I would just prefer a foreclosure because I can find mortgage payments for half of what I pay for rent and plan on using it as an income property in the near future.

 On a side note, Does anyone have a good recomendation for obtaining my real estate license. I have been doing some research and Keller Williams seems to have a better structure than most. I have been in sales for eight years and want to bring that to a larger scale in the world of real estate.
  • April 01 2013
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Profile picture for Pavel Stepanov
As previous posters indicated, it's unlikely that the lender would allow assumption of the mortgage in a foreclosure situation. However, if you have some cash, which you indicated you don't have much, you might  propose to pay off the outstanding balance in order to bring the loan to current status and purchase the property, but I don't think it's practicable. Furthermore, it's not a good idea to assume the loan because most likely, when you purchase the house " due on sale" clause may kick in and the lender may call the loan upon transfer of the deed. It's best to purchase this property at a short sale instead. That way, you buy this house at a fair market value, avoid the mess associated with the past due mortgage and can take advantage of the current low rates.
  • April 01 2013
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FHA loans are assumable but that generally doesn't occur in situations as you describe with distressed properties.   On traditional foreclosures when conventional loans are involved the bank that is foreclosing won't let you just take over the mortgage and alot of times the reason for foreclosure is that the people are underwater so you wouldn't really want to walk into that situation. What price range are you looking in and how much money do you have saved up?


  • April 01 2013
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Profile picture for wetdawgs
It sounds like a very scary situation.    With an almost-foreclosure, the owner hasn't paid their mortgage for a while so there will be penalties and back payments to catch up.  There may be liens on the property (taxes and whatever).   Often this happens because the home is under water, so you'd be assuming a mortgage where you owe more than the house is worth.   In addition, in order to assume a mortgage you have to qualify.  

  • April 01 2013
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