Property Q&A in Sebastopol>Question Details

ammysan, Home Buyer in Sebastopol, CA

How may I find out more about this and other foreclosure properties in the area?

Asked by ammysan, Sebastopol, CA Sat Sep 1, 2012

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The property you've asked about is 1070 Ferguson Rd, Sebastopol. The loan in question is a second for $75,000, which is currently in default.

However, there is another loan in first position on this property for $446,250. If/when the second lender forecloses, that lender will be required to pay the first lender $446,250 or make those loan payments in order to control the property. Most lenders with a loan in second position do not spend any money foreclosing due to the more usual situation where the drop in property value is already below the first loan amount.

However, in this case, with most comparable sales quite a bit higher than a "breakeven price" on the first loan [first loan breakeven price would be approx 470k unless it is in bad arrears which it probably is], it seems to make sense for the second to get either the 75k from an auction sale, or take the property back then sell it for net proceeds after paying off the first loan.

Foreclosures and the foreclosure/short sale market can be tough to grasp with their different procedures and expectations. Answering questions like you posed requires a real estate representative to have access to specialty sources, the understanding of all facets of foreclosures and short sales, plus the time and ability to figure out what is actually going on with a specific property.

Please check out the Foreclosure Search Engine on my website, and don't hesitate to ask any questions you may have. I have truly become an expert these days! cj
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