I have a friend that is moving and is going to stop paying all his bills. He has a house and 10 acres of land that me and my hubby would like to get. Our credit is bad, and so he was going to go to attorney and get rent to own papers drawn up untill we can get credit up some more. It is rising every month. Problem is he has a HELOC for about 20,000. Will they foreclose if he does not pay this amount? We really want this house but we can not afford the HELOC payment and the house payment. Does anyone have any suggestions as to what we may can do to get this house?
Thanks,
2007-07-07 07:53:42 · 5 answers · asked by smallhats8 2 in Business & Finance ➔ Renting & Real Estate
He can't sell the house unless he pays off all liens at the closing. You may end up paying several years and get nothing. The lenders will foreclose if he doesn't pay his debts but if the didn't the late fees and interest would build faster than any equity he would have. You could rent to own but still not get to ever buy it and at sometime you have to go get a mortgage big enough to pay the asking price and that has to be big enough to pay off his debts that the house is collateral for. Have you even done a title search? He may have other liens and not even know it and he can add more liens while you are renting until more than all his equity is gone.
I would have nothing to do with this myself even if I trusted the seller, I wouldn't trust someone who decided to walk off and leave his debts.
2007-07-07 08:03:21 · answer #1 · answered by shipwreck 7 · 1⤊ 0⤋
Of course they will foreclose. Go to the noteholder, describe the situation, and see what can be worked out. You may be able to do a deal in which you continue paying on the LOC without paying off the whole thing at once. If you can get that far, you may be able to sell off some of the land to reduce the total indebtedness.
2007-07-07 08:04:38 · answer #2 · answered by Anonymous · 1⤊ 0⤋
Yes, if he doesn't pay the HELOC, they will foreclose on the property.
I would stay away from this deal, because you could find yourself moving again unexpectedly.
2007-07-07 08:42:01 · answer #3 · answered by Expert8675309 7 · 0⤊ 0⤋
Yes the holder of a 2nd Mortgage(HELOC) can initiate foreclosure if you fail to meet your obligation. They first contact the title holder who is usually the escrow company and begin officially serving you with notice. The Original lender can not stop the process however they are the first payed after the sale of the home with what ever remaining being paid to the HELOC and finally to you if any is left.
2016-05-20 23:12:50 · answer #4 · answered by ? 3 · 0⤊ 0⤋
seek family and friends for help. or talk to the lender that is going to foreclose on the house about taking it over.
2007-07-07 08:05:40 · answer #5 · answered by just hanging around 5 · 0⤊ 0⤋