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Most of my real estate career has centered on buy, fix and sell SFR’s. Three years ago I got a big head and bought a commercial property in another state. It has been nothing but problems and I have lost a lot of money.
Skip ahead to the last 3 months. In Money Matters Jack says to cut your losses in this market. I’ve stopped making payments for 3 months to get the banks attention. Had been current up to that point. Now the bank is leaning on me and mad that I’m keeping the rents for the 3 months from the tenants. I do feel bad about that but was advised that’s the only way they’ll listen.
At this point I don’t want the property, will take my losses and move on. The bank officer told me today that I should be forwarding him those rent checks. said if I did that maybe they’ll take it easy on me in regards to deficiency, etc. Don’t know if I believe him.
I also have a local company trying to short the property with the bank. Any comments or suggestions on how I should proceed. Also a seller second on the property.
Have never gone down that path before, though have contemplated it myself in the future based on hearing about it at Money Matters.
Suggest you get everything/anything you agree to with the bank in writing from an officer/official who is “authorized” to make any agreement with you. I may be wrong, however the rent would stay in my pocket unless the bank agrees to terms agreeable to me – ie written “no deficiency”, etc.
Thomas
Perhaps the bank will do a loan modification so you can keep the property until you can find a buyer.
Each state has different rules are deficiency judgments — you should check that out.
collecting rents and not making the mortgage payments is called equity skimming and it is a felony from what I understand.
Maybe it’s time to rethink your strategy. Send those rents in to avoid a big fine or possible jail time.Have you considered giving the bank a deed in lieu of foreclosure
Every single person I know who buys a property out of state has problems. I think it is a HUGE mistake.
It’s is MUCH better to buy in your own backyard.
Jackie
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