I am trying to get information on a company called HR National. They apparently list properties for sellers that are nearing foreclosure. The idea is, at least the way I understand it, is that this company list the property and tries to find people to take over the sellers mortgage payments. The way this program is to work is that he mortgage would remain in the sellers name, thus not requiring credit qualification, and the seller would Quit Claim the property to the buyer, so that the buyers name is recorded as the legal owner. The buyer could refi or just continue to make the mortgage payments directly to the lender until it is paid off.

I want to know is this legal, a scam or what; any information that can be provided is appreciated.

I don't know if it is legal or not, but it sure sounds like a poor decision for the seller to make.

To trust that the buyer will pay the mortgage, that is still in the sellers name?

I would have to pass on that arrangement.

Hello v:

No, it won't work. As soon as the quit claim deed is filed the bank will call in the loan. If the buyer can't get refinanced, the bank will foreclose and take the house.

excon

If the seller will furnish a contract for the deed ( legal in most US states) but no, if the mortagage is not changed, the property can not be quick claimed deeded over ( well you can't file the deed, you could hold on to it and hope the seller does not resell it)
Also you will be responsible for (as the buyer) to pay any late fees, any behind payments and so on.


I am sure there are companies that are doing this, but as the buyer without a power of attorney to allow them to talk with the lender if there is ever a problem the lender will not even talk to you, so when they claim they never got August payment, the old owner would have to call the loan company for you.

Also as the seller, if the new buyer does not pay, it will effect their credit again. And as seller, if the new buyer drops the insurance, the seller can be held liable for property if there was a fire to the lender.
I may do it on a contract for deed, in fact I do them, but not under the terms you explained

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Originally Posted by valsally

I am trying to get information on a company called HR National. They apparently list properties for sellers that are nearing foreclosure. The idea is, at least the way I understand it, is that this company list the property and tries to find people to take over the sellers mortgage payments. The way this program is to work is that he mortgage would remain in the sellers name, thus not requiring credit qualification, and the seller would Quit Claim the property to the buyer, so that the buyers name is recorded as the legal owner. The buyer could refi or just continue to make the mortgage payments directly to the lender until it is paid off.

I want to know is this legal, a scam or what; any information that can be provided is appreciated.

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Nine states now have strict laws regarding such transactions. California and Washington are but two of the new ones.

I bought such a property to remodel and sell. After I fixed up the property, the previous owner claimed he never signed the Quit Claim Deed. It was signed, notarized, (in front of a notary) and witnessed. The court decided they needed to find out all of the details of the transaction when he filed a Quiet Title Action.

Two years later, $160,000 in LEGAL FEES alone, and non-use of the property (I couldn't sell it since it was in a legal dispute) it was decided that I was right. Hmmmm, little comfort that he had lied throughout the entire process. The documentation alone fills three large boxes and takes up half of a disk drive. Of course I had a counter suit and fortunately was awarded legal fees. The Title Company that I counter sued and the Lender (who now is out of business) had to pay my fees.

Was it worth it? Nope.

Would I chance it again? Nope.

Even though I thought it was a legit transaction.

Too many other good opportunities for fixers out there.

My experience is that desperate people do desperate things to "save" their homes and will use ANYBODY along the way to accomplish that.

I now have a very large "stupid tax" that I've paid (loss of use of the property for two years) and feel that I've earned my degree in Real Estate Law.

If you want to make money in Real Estate, buy low - fix up - sell high and don't get trapped with pre-foreclosures. Call the bank and buy REOs (Real Estate Owned) or use a Real Estate Agent.