They couldn’t sell the house for $1 million at the trustee sale but were able to sell it for $1.3-$1.4 million at a later date. How does that work?
I’d guess one of three reasons:
1. The market was really soft in January. At least now, we have an illusion of a spring pop.
2. There may have been a small 2nd or other suborbinate lien attached that got wiped out by the 1st going foreclosure. The junior lien holder didn’t step up to cover the million in an effort to save their smaller loss.
3. $1.05M is about 22% below $1.3M, that’s a little lean for REO flip. Sure, $300,000 looks like a lot on paper, but at that level of leverage, a percent here, percent there, and you’re back under water before you know it.
