Leins?

[ScottS]

I have come across a couple of leads recently where the vendor is motivated, maybe a payment behind. They are willing to sell for what they owe, but the leins are nullifying any potential equity. Just wondering if anyone has some experience with leins and if there is anything special to working with them. My thought was putting the property under contract, and then negotiating with the companies that have leins to see if they could be reduced. Love to hear any thoughts from people with more knowledge in this area.

Thanks!

 

[BarryMcGuire]

Hi Scott. By liens do you mean mortgages to banks, builders liens or writs of execution from successful lawsuits? let`s say you mean all of these. For anyone who has a financial claim against a property, successful discounting of their lien depends on them believing that they won`t get all of their money out of the property. Banks are usually the toughest to negotiate with especially if they have a first mortgage. Banks are gigantic, they have lots of policies, they don`t need the money, accepting a discount probably means going up three or four levels through the bank hierarchy so it`s often tough with banks. Other lien holders are smaller, may need the money, may not want to wait for their money and it`s much easier to find a decision-maker. My experience in helping my clients with trying to discount liens is that you need to do a really good analysis at the beginning of whether or not the lien holder has any motivation. If you can`t say that they have motivation there is a lot of wheelspinning and time spent with no positive result.

cheers

Barry