| epitome |
07-07-2010 08:47 PM |
Quote:
Originally Posted by L-Pink
(Post 17317284)
Care to share details?
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In short, a front foot is the first few feet of property that abuts the street. Smart developers ran utilities themselves and kept ownership of that land. They then charge a yearly fee to the homeowner for use of that land as well as to recover their investment in utilities -- I believe it is typically for 30 years. It ends up being "free" money (using that term very loosely) though because they often financed it in the builders loan and paid it off when they sold the house.
Now here is the thing ... if the front foot fees are not paid you can foreclose on the house. You're in the first position and can actually steal it out from underneath the bank that bought the note. Because of this, a lot of banks prefer to escrow the front foot fees. Granted, it doesn't happen often, but it has happened and a few savvy people have gotten a free house -- that is just a bonus though.
If a front foot is worth $40k payable over the next 30 years, if you search long enough or buy them out from a big developer that is cash strapped you can get them for a fraction of that.
Guaranteed money at a good rate for the next 30 years. Buy enough of them and you may end up with a free house or two over those 30 years ... if not, it's easy and steady income.
A lot of developers are surviving right now off those fees. Others are so under water that they are dumping them in exchange for quick and easy cash.
Finding them is the tricky part but I know where they are. Sadly, I can't act at this time. |
