Calling The Shortsale Pro
You recommend that we use an LLC to get around the non-assignability of an P & S agreement right?
Could you use a land Trust to do the same thing?
Thanks,
Lonniewa
You recommend that we use an LLC to get around the non-assignability of an P & S agreement right?
Could you use a land Trust to do the same thing?
Thanks,
Lonniewa
This is what I had in mine.
Make an offer in he name of the "1267 Foreclosure Street Living Trust". When the bank appoves your shortsale proposal you then go and create the "1267 Foreclosure Street Living Trust with your company as the sole beneficiary and yourself as the trustee. You then go out and find a retail buyer or rehabber who like the house. You assign the beneficial interest in the trust to this new buyer and have all this held in escrow of course. The hud-1 and the P & S aggreement still matches. The assign fee would be paid to you at closing.
Do you think this would work? If not please tell us why it would not work.
Thanks,
Lonnietacoma
I have a close friend who had a SS refused because the buyer was an LLC. Not a normal situation, but it does happen. I have had a land trust as the buyer in a SS P&S. My reason for using a land trust was not for assignment.
The SS investor might not like the fact that the trustee of the land trust has changed. The Jack Smith, trustee signed the P&S and Debbie Johnson, trustee signed the HUD1.
Brenda
Plan would not work for a retail person getting a mortgage. Conventional lenders do not like any kind of assignment (where the original Buyer makes money above the purchase price). So I am Nancy Normal and I tell my bank that I want a mortgage. If you use the P&S that you used for the SS lender, then you have no profit. If you write up another P&S, who the heck is the seller - it better be the owner of record. I would love to be there when Nancy tells the bank that a land trust is buying the property from the owner, then at the same time she having the beneficial rights assigned to her. Banks also do not like land trusts.
Brenda
Thank you verry much for your reply.
But lets say that I remain the trustee but my corp assign its interest in the LLC to the investor. I still will sign the final hud-1 as the trustee at closing. After closing I would resign as trustee.
2. So assign a beneficial interest in a land trust to a convention buyer probably would raise some red flags with the lender I have to agree. Is a double close still a viable option as long as the buyer is not getting an FHA loan?
Thanks for much to all who can help with this.
Lonnietacoma
Because in most case you will need a discount in order to make a profit.
Thanks,
Lonnietacoma
Hi Lonnie I am in the middle of my first deal as i described. I got the deed in my name and have faxed the lender a offer of 48000 on a bal of 70000 they said thay would let me know tues. i asked for 45 days. i will do some repairs about 20000 and sell for 120000 since i already own the property i just need to know the payoff. i am new but i dont see why this wont work for you.
Life is easy if your incoming buyer has cash. It is when they are getting a mortgage that things become inflexible.
MAVLJC, I would not expect the investor to approve your short payoff based on the numbers you have given. In your offer to the investor - did you include a P&S? Most investors (all first lien holders that I have ever worked with) require a P&S. The investor expects the person who signed the HUD1 (Settlement Statement) as the buyer to be the same person who signed the P&S as the buyer. Not a problem if you plan on buying it, rehab, and then retailing. The original poster wants to flip the short sell.
Brenda
Hi Brenda, i just hand wrote a offer on plain paper and signed it and faxed it to the bank, they gave me a reply today after i called them alot. i offered 48245 on 70000 they countered with 55000 and 1500 a month for 2 months. i said ok but now has to be approved by supervisor i will know monday. i looked at a hud 1 and told the bank i did not understand it and i didnt want to sign one. they told me to hand write the offer so i did . i own the house and can sell it how and to who i want as long as the bank gets its 55000 thank you Michael
Hi I told the lender i had the deed in my name in my first conversation with them. I told them i already started the eviction. I told them i was going to resell the house as soon as i got the people out and did the repairs. I have not heard anything negitive from them and i told them this was my first time doing this and asked them to help me through it and they said ok. At this time i dont understand the lack of cooperation with your situations. I will Pray that God will Bless You as He does me. Thank You, Michael Vecchio
hello,
I want to know if you recommend telling them you took deed into trust. the last two SS i did i did not tell them and i didnt like it. normally the first thing i would do is transfer the property into a trust and hold the ben. interest. Then submit the SS package. I would then put the prop on the mrkt right after the BPO and get the buyer. As long as they Bank recieves full payoff there should be no problem..correct? Now i am just going to start telling them right away that i am the new owner of the property and that i can work with them to get rid of the property. i Have had many people tell me this is the best thing to do. Anybody else feel this way? thanks, Ryan
so how do you recommend doing it? At what point do you take the deed? do you use a trust? how do you secure your interest in the property?
I know many people who do ss this way and personally it seems like the most practical thing to do. You have never actually explained how you would do a ss deal. you have said what not to do and why it shouldnt be done. With the way you explain things it seems that you couldnt possible do a smooth transaction with no money. Yes, if i could fund deals myself all day long i would do them w/o taking the deed. However, i can not do this and i need ownership of the property in order to list it with my agent so i have to take title asap so i can find an end buyer quick enough to fund it.
thanks, Ryan[ Edited by ryand on Date 06/15/2005 ]
When you prequalified this candidate for short sale feasibility... what was to have been your compelling argument?
Financial hardship is a primary element for any preforeclosure short sale consideration....
How much is owed / how much is it worth?
They owe 400 appaised for 425
Thanks Shortsalepro