First Sale Scheduled

[GoingBrokeFast]

The first of our nightmare "income" properties is now scheduled for sale the second week in July. We are at least 200k underwater on it. I have done nothing to slow the process. I want the building and the tenants gone asap since I have no income from it, a PITA tenant with the building inspector after me and expenses up to the sky. The last payment was in December. I suspect the bank will buy it in. That is what is happening to income properties in the area with few exceptions. They are welcome to the problems. A five unit on the next street with one holdover tenant and bank owned was set afire last month. It is now in a very bad area. What a difference 10 years has made for worse in the neighborhood. This is a recourse state so this may not be the end of it.

[Evan Bedard]

That is what is happening to income properties in the area with few exceptions. They are welcome to the problems. A five unit on the next street with one holdover tenant and bank owned was set afire last month. It is now in a very bad area. What a difference 10 years has made for worse in the neighborhood. This is a recourse state so this may not be the end of it.

What state is your investment property located in? If you stopped payments in December (depending on the state) it could still be quite some time before a foreclosure date is scheduled.

[GoingBrokeFast]

This clearly is the sale date since the notice of sale was sent via certified mail from the attorneys representing the bank and will have been published in a major newspaper listed on the notice of sale on a specific date stated in the notice.. the sale is listed on the major foreclosure auctioneer for the state's website. I am an attorney, though in a totally different area. I checked this out with other attorneys who I know and in our small northeast state, it happens real fast. This is a non judicial state. The bank's attorneys are doing it by the book as far as the procedure is concerned. I will not oppose or try to delay the sale, so it will happen as rapidly as possible.

[Evan Bedard]

I'm very sorry I misinterpreted the first sentence where you said the sale date is scheduled for the 2nd week in July.

[GoingBrokeFast]

I'm very sorry I misinterpreted the first sentence where you said the sale date is scheduled for the 2nd week in July.

No problem. I know this is very fast. I expect the second one to follow in another 30 days so an early August sale date.

I am wondering if they will go after us for the shortfall which I know is inevitable. We already have a bankruptcy lawyer retained so that we can move fast, if need be. I am hoping for the best, but truly expecting the worst.

[Evan Bedard]

Since your property is in a non-judicial state the chances of the lender pursuing a judgement once the foreclosure is final is very small even though this is an investment property. What state is this home located in?

[GoingBrokeFast]

Since your property is in a non-judicial state the chances of the lender pursuing a judgement once the foreclosure is final is very small even though this is an investment property. What state is this home located in?

I think there is a pretty good possibility despite it being a non-judicial state. It seems to be happening somewhat more than expected. Our bankruptcy attorney and several other lawyer friends confirm this. We are in a small mostly rural state. i am afraid to ID it since we are pretty easy to id if the state were named.

[Evan Bedard]

Since you are an attorney yourself and know several in your area I'm sure you have a much better idea than myself of the likelihood of a deficiency judgement happening.

[GoingBrokeFast]

Since you are an attorney yourself and know several in your area I'm sure you have a much better idea than myself of the likelihood of a deficiency judgement happening.

Because it is a small state with fewer foreclosures, it is more likely that the bank will sue for the shortfall. The law firm handling the first sale is also handling the second. It is pretty hard to hide in plain view when there are not masses of foreclosures like in AZ or CA. The only good thing we have going for us thanks to huge medical bills not covered by our health insurance is we now both have lousy credit. That hopefully will lead to the banks thinking we are not worth going after, but I am not holding my breathe.

[GoingBrokeFast]

We are now being bombarded daily with certified letters from the lawyers handling the first foreclosure. It is the same letter over and over agian. The foreclosure mill handling ti does not even use printed stationery. The envelopes are just cheapo paper with computer typed return address. I am kind of happy they are burning through over $5 per envelope per day.

[Evan Bedard]

Yes it can be quite ridiculous how many times they will send out the same document to the same borrower over and over again. These foreclosure mill firms generally have lousy systems and sometimes will even send documents to the wrong property..

[GoingBrokeFast]

Yes it can be quite ridiculous how many times they will send out the same document to the same borrower over and over again. These foreclosure mill firms generally have lousy systems and sometimes will even send documents to the wrong property..

I know of several that the feds have shut off the supply of cases to and forced their closing. Florida comes to mind.

[TrappedInRealEstate]

Hi goingbrokefast, I was referred to your thread by a mod

I have a thread about my adventures trying to refinance my investment properties.
Investment Properties in Louisiana

I have 10 notes and am having difficulty getting anything accomplished. After you stopped your payments were you offered any rate modifications? I understand you are underwater to a level that you don't want that - but if you were offered anything I'm here to take some notes because I do NOT feel as if I can get any reasonable actions by continuing to stay current.

Thanks in advance & best of luck with your situation

[GoingBrokeFast]

I have 10 notes and am having difficulty getting anything accomplished. After you stopped your payments were you offered any rate modifications? I understand you are underwater to a level that you don't want that - but if you were offered anything I'm here to take some notes because I do NOT feel as if I can get any reasonable actions by continuing to stay current.

I got one letter saying that I could save my "home" in a package with some slick printed material, form letter and packet, nothing else. I seemed like it was for owner occupied primary residence , nothing else. My properties are so under water and in such a bad area now that the auctioneers are selling a burnt out she on one street with a minimum bid of $1500. that does wonders for the value of one of my buildings on that street.

10 notes are more than triple the number I have. i wish you luck. I know the terrible feeling of being trapped.

[GoingBrokeFast]

Now that I am more awake, what I meant to say was that the burnt out shell of a building located on the same street as one of my loser properties is being auctioned off with a $1500 reserve. It has the land plus water, gas and sewer hook ups. the reserve shows you how blighted the neighborhood has become. One of my former tenants was just sentenced to prison for heroin distribution, the same tenant who I evicted a year before for non payment of rent. She was another section 8 nightmare.

[GoingBrokeFast]

The first sale is coming in a few days. The mortgage is part of a securitized pool with about 5 holders in due course. It is hard to even know who holds the paper. They have a 20 year statute of limitations to go after me for a deficiency. It is identified as a pass through certificate number such and such of a pool.

[freedomwon]

The first sale is coming in a few days. The mortgage is part of a securitized pool with about 5 holders in due course. It is hard to even know who holds the paper. They have a 20 year statute of limitations to go after me for a deficiency. It is identified as a pass through certificate number such and such of a pool.

Hi GoingBrokeFast - What is your goal with this property that has an upcoming sale?

1. Buy yourself more time?
2. Walk away & set it aside for now?
3. Try to get a loan mod?

BTW - What area of law do you practice?

[GoingBrokeFast]

Hi GoingBrokeFast - What is your goal with this property that has an upcoming sale?

1. Buy yourself more time?
2. Walk away & set it aside for now?
3. Try to get a loan mod?

BTW - What area of law do you practice?

The goal is to unload these money pits, worthless buildings and hope that I do not get sued for the deficiency. However the statute of limitations is 20 years. That is a long time to have this hanging over my head. The bk will be delayed as long as possible for now. That is subject to change based on many variables. We waited too long to default and threw way too much money down these money pits causing us to under mine our financial security and now we have lost so much.

I am a criminal defense attorney.

[freedomwon]

The goal is to unload these money pits, worthless buildings and hope that I do not get sued for the deficiency. However the statute of limitations is 20 years. That is a long time to have this hanging over my head. The bk will be delayed as long as possible for now. That is subject to change based on many variables. We waited too long to default and threw way too much money down these money pits causing us to under mine our financial security and now we have lost so much.

I am a criminal defense attorney.

I know all too well about throwing good money after bad. I did it for too long with my primary residence paid 400k & worth about 120k today. Not a good investment. It's unsettling at best that statute of limitations is 20 years over in your neck of the woods.

I WOULD NOT suggest a short sale for the following reasons: Your servicer wants updated details of your financial condition in order to decipher if it is cost effective to sue you for a deficiency judgment after your property is taken (if it is to be sold in the near term, they will want the fastest sale, not the highest sale), it is not primarily, as you may be told, to determine qualification for a modification, short sale, or DIL.

For example, they would like to know where your bank account is so that they can attach it, and they would like to know where you work, and see a recent pay stub, so they can eventually garnish your pay.


Knowledge is power. The more knowledge they have about your financial situation, the more vulnerable you become to their power. So whatever you do, don't make it easy for them!

I think the best strategy would be to wait until your are legally served, then file bk (only if necessary). Just because they can come after you doesn't mean they will.

[GoingBrokeFast]

I WOULD NOT suggest a short sale for the following reasons: Your servicer wants updated details of your financial condition in order to decipher if it is cost effective to sue you for a deficiency judgment after your property is taken (if it is to be sold in the near term, they will want the fastest sale, not the highest sale), it is not primarily, as you may be told, to determine qualification for a modification, short sale, or DIL.

I would never do a short sale or cooperate in any way with them. I refuse to give them any info.

For example, they would like to know where your bank account is so that they can attach it, and they would like to know where you work, and see a recent pay stub, so they can eventually garnish your pay.

I am self employed so there is no pay stub and they can never garnish my wages. I will retire.


Knowledge is power. The more knowledge they have about your financial situation, the more vulnerable you become to their power. So whatever you do, don't make it easy for them!
As an attorney, I would never make it easy for them.



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I think the best strategy would be to wait until your are legally served, then file bk (only if necessary). Just because they can come after you doesn't mean they will.[/QUOTE] That is true but the problem is it can affect many other things such as estate planning. i do not want my kids to have to deal with this as potential claims against my estate. what a mess that could hang over my head for 20 years.



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[freedomwon]

GoingBrokeFast - Would it make sense to incorporate in the state of Nevada or Delaware? Would that provide some asset protection for you? Perhaps put your kids on the board of directors? I believe the state of CA will treat it as a foreign corporation since it’s out of state.


Could be worth looking into. I agree 20 years is a long time to have this “hanging over your head”.

If you haven't do so already, check with an attorney in your area that has extensive experience in these matters. There's got to be a solution that offers you some protection. There's always a loophole in the law somewhere, you just have to find it.

[GoingBrokeFast]

GoingBrokeFast - Would it make sense to incorporate in the state of Nevada or Delaware? Would that provide some asset protection for you? Perhaps put your kids on the board of directors? I believe the state of CA will treat it as a foreign corporation since it’s out of state.


Could be worth looking into. I agree 20 years is a long time to have this “hanging over your head”.

If you haven't do so already, check with an attorney in your area that has extensive experience in these matters. There's got to be a solution that offers you some protection. There's always a loophole in the law somewhere, you just have to find it.

I have 2 CPAs and a bankruptcy attorney working on it. the problem could be any transfers to family without valid consideration could be considered fraudulent transfers and could lead to claw backs under bankruptcy laws. The only protection is to become judgement proof spending down to bankruptcy exemptions. IRAs and homestead property are exempt for example plus federalor state exemptions.

The new bankruptcy laws offer less protection to individuals and tries to force people into chapter 13s with years of repayments and control by the bankruptcy court.

In the old days, there were Swiss bank accounts and off shore corporations and trusts, the federal law now goes after people with those types of assets.

[GoingBrokeFast]

First sale date has come and gone. No deed recorded yet. Either delay for bank to record it or sold to 3rd party with 30 days from sale to close. I check on line each day several times per day for that deed. Also, the second property is now on fast track to sale.

As an aside, tenants still fighting eviction and I can not stop litigating until deed recorded.

[GoingBrokeFast]

Rotten non paying tenant in first sale building just texted me telling me water heater (2 years old) is broken. They ask if I know who now owns the building after the auction. Good luck to them with these pita tenants. I needless to say will not respond to them.

[TomEason]

Hi GoingBroke

Sorry to hear the update about your apartment buildings going to sale. However I know you've been hankering to rid yourself of these alligators.

Not that it makes any difference in your situation, but my reference indicates the longest SOL in the 50 states is 15 years, and that's in the states of KY, OH, and RI.

I may be missing something here, which wouldn't be the first time, LOL.

[GoingBrokeFast]

Hi GoingBroke

Sorry to hear the update about your apartment buildings going to sale. However I know you've been hankering to rid yourself of these alligators.

Not that it makes any difference in your situation, but my reference indicates the longest SOL in the 50 states is 15 years, and that's in the states of KY, OH, and RI.

I may be missing something here, which wouldn't be the first time, LOL.

Contract under seal- the note- 20 year statute of limitations;

[TomEason]

Contract under seal- the note- 20 year statute of limitations;

Thanks for your reply.

Unfortunately I've unable to confirm a 20 year SOL on a written contract in any state. Again, the longest I can find is 15 years. But either way, it's a long time! Good luck to you.

[GoingBrokeFast]

Thanks for your reply.

Unfortunately I've unable to confirm a 20 year SOL on a written contract in any state. Again, the longest I can find is 15 years. But either way, it's a long time! Good luck to you.

Big difference between contract and contract under seal. That is why mortgages and notes are signed witness my hand and seal. Judgments are valid for 20 years too and can also be extended. This is basic bar exam info in may state. That is why it is so important to havwe an attorney and a CPA involved who know these types of answers.

Just got notice of auction sale of second property next month.

[GoingBrokeFast]

The foreclosure deed has been recorded for the first loser property. The bank now owns it and the price is listed as over a quarter of a million less than the amount of the mortgage.