Do you mind explaining how one can owe far less than 80% of a home's value within months of borrowing to purchase said home with little or no money down?
Maybe the home went into forclosure because the previous owners refused other willing and able buyers who wanted to pay 20-50% more than you did. Were there lots of other cabable buyers eager to pay what you paid to get the house?
Yes.
The previous owners listed their house for 6 months while falling behind on their payments after a divorce split the home, and the home eventually went into foreclosure. The sellers dropped the price $20,000 per week for a month before the final foreclosure date, then went BELOW the amount owed on the home by $35,000 with agreement from the bank to try to sell it before foreclosure was final.
An investment group was also bidding on the house. I just happened to get a contract in a few minutes before the investment group the morning they made the "final price drop" (foreclosure was final that day at midnight). They accepted my contract, and we closed 10 days later.
Everything else in the neighborhood is still listed (7 homes out of 120) and only one (lakefront) has closed since I closed. My house is about 5 down from the lake and across the street, so not nearly the most expensive in the neighborhood, but still appraising highly enough to have 20% equity on paper. Certainly wouldn't sell for that right now, but don't need that to refi, just appraisal with comps showing the "value".
I got a GREAT deal because my aunt is a realtor and was best friends with the listing realtor and heard about it 2nd hand, just coincidental that I was looking. It's on the opposite side of town from where I wanted to be, but couldn't pass up that kind of equity. When the market recovers in 4-5 years, I'll sell the house and move back on the other side of town, use the extra money to buy some rental property, try to get some independence from this rat race we call "aviation".
Hope that answered your question. Best of luck to you!
