Need To Short-sale 2 Mortgages On 1 Property In 2 Weeks

I have a prospect being foreclosed (first mortgage) that has a second mortgage as well. The property sits on 15.5 acres and is scheduled for auction on July 23. This is my first short-sale scenario, and my mentor is too busy to help me right now; hope some of you out there can fill in! The second mortgage holder (individual) has sent a letter to my seller offering to accept 40K on the 52K note. I'm thinking I will be able to get this figure lowered substantially. The house is in very bad shape, so I'm getting comps on the land and preparing to put together a short sale package for the first, basically taking the position that the only thing of value is the 15 acres.

My question is, in what order should I contact the lenders - first lienholder first, 2nd lienholder 2nd, or do them simultaneously? Also, what sort of success have all of you experienced short-sellers had with offering a first lender a discounted amount on only the land? Any advice you can offer regarding making this all happen quickly is highly appreciated.

Cheers,

Storm

Comments(2)

  • TheShortSalePro14th July, 2003

    In order to make any intelligent comment, you would first need to disclose a bit about the first mortgage, including the type, and the amount of the first mortgage, and the property's as-is, FMV.

    Is your state a judicial or nonjudicial foreclosure state?

  • Storm3314th July, 2003

    "In order to make any intelligent comment, you would first need to disclose a bit about the first mortgage, including the type, and the amount of the first mortgage, and the property's as-is, FMV.

    Is your state a judicial or nonjudicial foreclosure state?"

    My apologies - I should have included more info. The first is a 30-yr fixed @ 12%, principal is $98K. The comps I have received on the acreage put it at about $78K, with the house being worth an estimated $2-5K in its current state. I'm waiting on additional comps to determine ARV.

    I'm working in Michigan, which I believe is a nonjudicial foreclosure state. The attorney for the lender files public notice ~30 days in advance of the auction, and the redemption period varies. In this case it is 6 months.

    I hope I've given enough information, but I'm so new to this you may need to specify what else you would need. Thanks for your help!

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