9232 Lone Wolf is a modest house located in the Villas @ Sky Vista subdivision in Stead. It was purchased new in July 2004 for $190,947 (median was $304,300 that month). The first loan was a 30 year fixed for $181,399 through First Horizon. In February 2005, the home was refinanced for $206,500 on a 125% Option ARM mortgage through World Savings. A $40,000 HELOC was taken out on February 2006 through Wachovia, the successor to World. A NOD was filed in November 2009 on a missed April 2009 payment. The house sold in a Trustee’s Sale to a 3rd party on 16 July 2010 for $43,392.63.
That looked like a deal, even for the deflated Stead market. On closer review, though, it turns out that the NOD and NOS were on the $40,000 HELOC and not on the 1st mortgage. There has never been a filing on the 1st, and it might even be current (though I doubt it). Did our buyer wonder why none of the pros on the courthouse steps were bidding on this "steal"? Has he figured out what he bought yet, or what that great sucking sound is? My guess is the house had been vacated, and the new "owner" doesn’t know yet. The upcoming NOD on the 1st pasted to his door will be his first clue.
We’ve talked about how rare foreclosures on 2nd mortgages are, but they do occasionally sneak into the system. This one was probably initiated by accident by Wells Fargo who inherited Wachovia who inherited World Savings, and different departments weren’t communicating. Normally, the bank would have had no bidders at the Trustee’s Sale, and would just take back the second. No harm, no foul, just a waste of legal and filing expenses. Not this time.