Do I need any special forms when purchasing IL pre-foreclosure?

I know CA has special rules for buying pre-foreclosures/foreclosures but was wondering if there was anything special about IL?

The technique I use for pre-foreclosures is doing everything I can to keep them in their home (and still make money). Only as a last resort do I suggest they sell, and then I try very hard to get them a fair price (80% FMV or so).

Some states, as you rightly point out, have recently enacted laws making it almost impossible to buy a pre-foreclosure home and then resell it. I don't personally know about IL, but Maryland is one of them, too. If you resell the house within a certain amount of time, you have to give a % of the profit to the people who sold you the home.

Fortunately, NH has no such silly laws.

Seems to me that this defeats the purpose, and it's going to be a lot harder for people to get rescued. That said, if you focus on other ways to help people in pre-foreclosure, you'll make money and potentially be a hero at the same time.

[Whatever you do, don't buy it from them and rent it back to them!]

Thanks for your reply. I've learned to research things a little better when it comes to legislation. For example, there is legislation in the works for IL that would require that one pay 82% FMV to a homeowner, however, that would only apply if one
(a) bought the home and allowed the homeowner to have interest in it.
(b) bought the home and then leased it back to the owner with an option to buy.

If one buys the home outright, the 82% rule does not apply (to my understanding, and I'm not a lawyer).

I'd be curious about MD law but suspect the 82% rule does not apply to straight purchases, as that would be government interfering with the free market.

You are correct that the 82% rule does not apply if you plan to purchase and resell to someone other than the owner.

I will be interested to see some later numbers on how many additional homes went into foreclosure. The IL general assembly had their heads up their collective a$$ on this one.

More homes will end up in full foreclosure and as bank REO properties instead of being bailed out by an investor.

Many of those that the bill will effect could have avoided foreclosure had they just put their properties on the market before the final hour and in many cases they would have ended up with a profit on the house.

buy the home, put the property into a trust, assign a trustee to hold title and power of sale, give the homeowner 10% beneficial interest and you as the investor keeps 90% beneficial interest. all beneficiaries have the power of direction of the trustee to either sell or refinance the property to a new tenant/buyer.

im assuming this statement is true if theres enough equity to pay all parties off.

what about dealing with over encumbered properties? the sellers are gonna have to pay you to take the property off their hands

what if theres $0 equity and the home is worth the same when they first bought it?

just my .02 cents

In that case I would be negotiating with the lender for a short sale on the property

yea i was thinking a short sale too but then would you still have to give profits back to the homeowners after you sell it?

Not on a short sale. The homeowner would be gone from the picture completely. The homeowner would have gotten his by the lender agreeing to write off the difference.

You also would not be allowing the homeowner any interest in the property or renting it back to them.