Dwan's short sale secret #2
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Hi Everyone,
I'm going to try to answer all these questions in one shot....
*** When a short sale is accepted... say $100,000 property for $60,000. The bank just took a $40,000 loss. Three things can happen...the bank can seek a deficieny judgment, the bank can just forget it and take the loss, the bank can send the homeowner a 1099 for the short saled amount which is now income.
We always ask the bank to waive any deficieny judgment. Most times they will if you ask.
***When discounting a mortgage you do not need the cooperation of the homeowner. You are dealing with the bank directly. You do need cash to close as you cannot get a loan. You are buying paper, not property. Therefore, you have no collateral to give a lender.
***You can get the bank to agree to assign their mortgage to you, ask for 30 days to close, get the deed from the homeowner, and wholesale the deal using your buyers cash. We like to short sale and then wholesale our deals. We usually have only a $10 deposit in the deal.
Best of luck.....
Dwan
Dwan..I have a question
does a short sale look bad on sellers credit report...same as if they defaulted on the loan?
Good Question....
A short sale helps the homeowners credit as it shows the loan is paid off.
On the credit it looks like this.... late pays for many months and a satisfied pay off. If does not show up on the credit report as a short sale, just a satisfied loan, which helps the homeowners.
Dwan
Dwan
Good Answer
one more good question
is it possible to do a short sale if the seller is under contract with a realtor?
Dwan,
If the bank won't waive the defficiency judgement, won't that break the deal for the homeowner?
Jom
Dwan,
Could you also explain any situation where the home owner has to pay taxes on the difference between what they owed, and what they short saled for?
Do you discuss this with your home owners?
Thank you, Janis
I am in touch with a homeowner who is going through a foreclosure and willing to sell the building for the amount due, just to save his credit rating. Property worth is about $180,000 and he owes $150,000 on it.
Property needs some cosmetic work, nothing major and I like to do the short sale to get it for say 125K from the bank. Its in NY and Citibank is the mortgagee.
Someone there to help me with the steps, How to do it?Its my first deal. I appreciate the board and I have learned alot from it. Thanks
Is it workable, I mean descount wise.
TonyNY