Short Sale Deal, I Think
I just met with a seller in foreclosure. He is going through divorce and the wife doesn't care what happens to the house. He has no resources to cure the default. He owes 112,812 (including fees and back payments.) Comps in the area show 90,000-120,000 recent sale price in good condition. He was in the middle of painting some of the interior and exterior of the home when the divorce started. So it is not necessarily a junker, but I don't think I have much of a chance Subject to(my original strategy.) My question is, how do I go about initiating a short sale? I know I call the bank, but do I use an authorization to release information, or a limited power of attorney? Also, what would be a good offer. I figure about 3-5000 in repairs, paint carpet etc. Any help would be greatly appreciated. Thank you all.
Ryan
Quitting is the only failure I know. (I've done it before)
I had to add one question. I was wondering about proof of funds. I know Realtors ask that before they even know your name
I'm sure a bank is going to ask the same thing before they start negotiations on reducing a loan amount. I would if I were them. Any suggestions as to how to handle this aspect would be great. PS, my exit strategy on this deal is hopefully short sale, then flip.
Ryan
Hi, I recently finished a short sale with PCFS. I use the same Auth. to Release everytime. If you dont already have one you can make one. It just has to have the loan numbers, your name, their name, etc. i just sent them a hardship letter, net sheet, p and s, and some comps. after that he had a BPO sent out and i made myself the contact person and i talked to the appraiser about the prop and paid her off to come in with a appraisal. No, im just kidding. she understood what we were trying to do though and gave the house a fair value as it needed a lot of work. after that i got a call from loss mit telling me i had one month to close and that was it. i found a buyer and closed.
thanks, Ryan
if it needs work and has little equity, offer him as little as possible. unless its a hot market and he can sell before they foreclose. any where from a couple hundred to a couple grand.
i have not had an issue with proof of funds, i have heard some lenders require it some dont.
i would also suggest getting a course or reading through the articles section on this site, to get some more experience on this issue.
you need more exit strategies then just fliping it to a buyer. what happens if you dont find a buyer within 30 days that the bank gives you to close? lets say they wont delay it also? you need to have financing lined up if a buyer falls through?
yes we did it this way, but we also had a cash buyer who didnt need to obtain financing.
p.s. if i were you i would have his wife quit claim the house to him before you start doing all the work or as soon as you know the banks willing to negotiate. or you could find that you just shorted the house for them to sell it on there own. (i call that charity work)[ Edited by ZinOrganization on Date 01/19/2005 ]
Thanks to both of you. I will be getting the authorization signed by both of them. I will then see if the bank will negotiate.
Zinorginization, I don't actually know what I would do if I couldn't find a buyer within 30 days. I would of course ask for an extention. I am hoping that I can get the bank to discount enough so that if I have to, a HML will be willing to work with me. I will also call a few of the investors I know around here and see if they would be interested in purchasing the prop or (worst case scenario) see if they would partner up with me where I do the work to the house and they bring the funding. Any suggestions that would help to hedge risking my integrity would be great.
Ryan
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The only failure I know is quitting.