I Inherited What??

I met Tim last week while door knocking homes in Torrance, CA.  He explained to me that he had inherited his father’s property after he unexpectedly passed away over 1 year ago.  Tim’s father took out a Reverse Mortgage almost 6 years ago and when he passed the Lender gave Tim 1 year to satisfy their mortgage either by refinancing or selling the home.  Tim unfortunately was unable to refinance the house and never considered a Sales option. So the Lender placed the house into default for not performing.   The house was now 30 days away from an Auction so I set an appointment with Tim to discuss his options.  This is his story…

Tim’s father purchased this house in Torrance back in the mid 1960′s.  He moved to California to pursue a Welding career and ended up at a Plant welding for a company in Torrance, CA.  Tim grew up in this house and followed his fathers footsteps as a welder.  For the last 40 plus years Tim’s been in and out of living in this home.  The last few years Tim has been taking care of his father due to his age and health problems.  Unfortunately, Tim’s father got sick, wasn’t able to recover from it and passed away very unexpectedly.  Tim wasn’t prepared at all for this loss and quickly realized that his father had several debts including the house that needed to be satisfied.

Tim had worked very infrequently while his father was sick, mostly on temp assignments or contractually for short period of times.  When his father passed all the creditors started calling and harassing Tim.  Although he wasn’t financially responsible for his fathers debts he was the person they could try to get something out of.  Times are tough for everyone so even creditors are a bit desperate.  The major issue was the house and the Bank gave Tim the allotted time to do something to satisfy their agreement. Tim’s father did place the property in a trust and gave clear directions to Tim on how to disperse what he had.  Unfortunately, what Tim didn’t realize is most everything it took, to handle his fathers affairs, required money.  So although Tim wasn’t the one financially responsible, he started to feel and act like a homeowner in denial with their foreclosure.  Without a full time job and hardly any money in his bank account he wasn’t going to be able to refinance the home.  But like most homeowners in foreclosure, he waited so long that he was now faced with a pending Auction of his home in less then 30 days.

The first thing I had to do was asses his entire situation, to figure out what I was dealing with.  Next, I had to figure what Tim’s capacity was to resolve this matter.  What has he done already and what was still possible.  And lastly, I wanted to know what he wanted to see happen immediately and in the short to mid term future.

Once I understood everything  it was clear what needed to happen.  He had to sell his home to prevent a total loss.  However, there were several things that made just selling it a challenging task.  With only 30days remaining before an auction of the property he needed to negotiate with the lender to prevent the auction from happening.  The house was also very old and run down.  It needed a lot work to get maximum value or else he would have sell at a serious discount.  Tim also had very limited finances but fortunately he had just secured a short term contract with a local company that would pay him for a couple months.  However, he didn’t have much in reserves and he was going to need money for a security deposit and first/last months rent.

What I proposed to Tim was to step in as a financial partner in the sale of his home and help him get where he was at now to wherever he was going next.  My proposal was simple but would maximize the sale of his home, prevent a total loss and allow him to transition to a new place seamlessly.  I would negotiate with the lender to prevent the sale from happening.  If necessary I would pay them money necessary to prevent the Auction from happening.  I would finance all the improvements to his home that were necessary in order for the property to sell at it’s highest value.  I would provide our relocation services to Tim which would help him find a place and pay the amount necessary to move in.  Tim wouldn’t have to come out of pocket for anything in regards to the sale of the property.  He would have an expereinced team working along side him that would eliminate any issues and insure maximu return on the sale of his home.

It didn’t take much for Tim to agree!  I’m happy to say this project is moving a long and the Auction of his home has been eliminated.    Tim has been very grateful and is eager to move on to the next chapter of his life.