Big Loss in Dover

Extra special double example weekend. Today's feature is from Dover. The owner purchased in the middle of the bubble - much better than end of the bubble prices - but the house and second mortgages just proved to be too much. By the timeline, it looks like the owner must have intervened since it appears to have taken longer from the start of foreclosure to REO than others we have seen from Morris County. So here is the property -

Here is the property info -

Property Detail

Beds: 3	Baths: 1	Family Room:
Kitchen:	Dining Room:	Living Room:
Den:	Units:	Parking Structure:
Year Built:	Living Area (sqft):	HOA Fees

Here are the financials -

• The property was purchased in September 2003 for $265,000.
• The first mortgage in September 2003 was for $212,000 with NJ Lenders Corp.
  
• A second mortgage was also taken out the same day in September 2003 for $53,000 also with NJ Lenders Corp.
• A stand alone second mortgage was taken in August 2004 for $61,000 with Fleet.
• The foreclosure process started August 2006.
• Current sale price is $244,900 with Bank of America.
  

With the first and second mrotgage, the home was 100% financed by NJ Lenders Corp. NJ Lenders is still operating over in Little Falls, wonder if they still lend 100%. So after 11 months with no real money invested, the owner decided to take out $61,000. If the paperwork was filed to start foreclosure in August - the 90 day cycle must have started May. Which was 21 months after borrowing the $61,000. So for the three years the owner was paying some type of mortgage they were also getting a second income of $20,333 per year. Not bad for a second income.

How are the lenders doing? Aside from eating the $61,000 they are down another $20,100 for the value between the 2003 price and the current sale price. Tack on another 6% for realtor fees and the lenders are down another $14,694. The lenders are set to lose a total of $95,794 just from the bad loans, plus all the foreclosure expenses will bring up the loss to another $50,000 give or take. That is a big loss in Dover.