Foreclosure Auction Cash Recapture Financing

Quickly Replenish Cash Reserves from a Foreclosure Auction Purchase

Peer-To-Peer Trust Deeds has a quick cash-out foreclosure auction cash recapture financing program that allows frequent California foreclosure auction buyers the ability to recapture 75% of their cash outlay within 6-7 calendar days after buying a property on the courthouse steps.

Our company has a special working relationship with a private money investment fund and a California title company that speeds up the cash recapture process for our higher volume house flipper clients who frequently acquire homes on the courthouse steps.

How it works is the title company issues a title policy commitment within one day of the foreclosure auction purchase by using the receipt from the trustee’s sale rather than requiring a trustee’s deed be recorded. Trustee’s deeds usually take 15-20 calendar days to arrive in the mail which then have to be recorded by the owner.  The private money investment fund usually issues loan documents within 1-2 days of the foreclosure auction purchase.  Give another 1-2 days for funding, recording and disbursement and you have a successful 6-7 day “cash recapture” loan.

The benefit to the frequent California foreclosure auction buyer is that they can quickly replenish 75% of their cash reserves to either go back to the auction the following week or use the proceeds for renovating the property.  We have seen this system work rather well for the clients who have taken the plunge into buying at the courthouse and then re-leveraging the home, using private money financing to acquire more homes at auction or through other networks.  However, real estate investors need to have an already successful system of managing projects, cash flows, and their finances in place in order to manage a higher project volumes using foreclosure cash recapture financing.

Example of Foreclosure Auction Cash Recapture Loans: 

We’ll use a $200,000 auction purchase price for the sample numbers:

  • $150,000 (75% Loan-To-Value)
  • 11.00% Interest-Only
  • $1,500/mo payment
  • 12-month term
  • No prepayment penalty
  • Closing costs: 1 Point + $1295 (Document/Valuation/Processing) + Title/Escrow