So I’m dealing with a situation that started simple but got complicated real quick. I have a Deed of Trust and the buyer agreed to give the property back to me, but when my title company did the search for the Deed in Lieu, they found a $3100 judgment against it. incurred by the buyers. The buyer still owes me $20K on the property (they’ve paid $10K so far), and I can probably sell it for $35-40K since I only paid $20K originally including survey, photos & closing costs. My title agent says best case is if they just pay that $3100 judgment at closing, but if they don’t, this whole thing goes into full foreclosure with my attorney. Honestly, I’m thinking it might be worth it for me to just pay the $3100 myself to get this over with and sell the property to recoup everything, rather than deal with all the time, stress, and attorney fees that come with foreclosure. I mean, I do these Deed of Trust deals specifically to protect myself, but man, in this case I really wish I had gone with a Contract for Deed instead! Any input would be greatly appreciated!
Most lenders go ahead and do a foreclosure since it would wipe not only your $3100 judgement but also anything your title agent might have missed. Weigh the cost of the foreclosure ($ plus aggravation) versus paying the $3100. But if you just pay the $3100 you will only have the title agent’s word that title is clean.
Does the $3,100 lien pre-date yours or are you in a first lien position?
FWIW I just paid $4800 for a foreclosure and it took a few months. If I could have paid $3100 back in February and had it over and done with, I would have done that.
@Danielle if I were in your shoes, I would totally pay off that lien and be done with it. It may not be fair, but it’s an easier way to get it over with, and you’ve got plenty of margin to absorb this.
It was clear when I purchased the property. The people I financed it to incurred a debt with a farm co-op. So I guess that means I am in first position?
Apparently the buyers had the farm equipment repossessed and they should be clear. That would be nice. I need to follow up with their lawyer on Monday. If that is not the case I am definitely going to pay it. I’m listing it and with the hopes I can double close on it.