Short Sale Methods?
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I am trying to figure out how i can help people in pre-foreclosure by finding them a new buyer and in the process get paid something for my time. I am wondering if anyone has any suggestions as to how i might structure the scenario below to make something for my effort:
Lets say I find a realtor for a pre-foreclosure client, I then get them to list the property at 300k and we successfully attract a buyer at 300k, and then if i get the bank to accept a short sale for say 280k is there anyway i can collect that difference of 20k.
I have tried to negotiate the short sale in my name and then get the bank to allow me to do an assignment of contract to the new buyer but so far no one has gone for that. I did talk to a suppossed "short sale expert" the other day and he suggested doing something about a residential land trust but i didnt fully understand what he meant by it. Something to the effect of me becoming a trustee on the property and then doing a double close and i keep the difference between the amount the bank accepted on the short sale and the amount the new buyer is paying. Like i said i didnt fully understand but would like to if anyone knows more about this angle. Any input on how to help people in this situation without actually purchasing the property myself would be greatly appreciated.
I apologize but I do not fully understand your post.
Are you a realtor? If not, how does the realtor get paid? You list for 300k and negotiate a short for 280k with the realtor paying you back the 20k? I do not think a realtor will pay a non licensed individual.
Who pays the realtor, the seller"? From what equity? If he is in foreclosure he probably does not have any cash either.
You do not need to find a realtor. You can put the property under an assignable contract and sell the contract to the new buyer. If all you are doing is assigning the contract you will not need to create a trust because you will not close. The new buyer will take possesion at the closing. You only receive the spread between the your buy price and your sell price. If you negotiated a short then your profit is the spread between the negotiated discount and your sell price less any cost you incur.
This deal seems a little "thin" so be very careful (realistic) about the true market ARV and the amount of short you will obtain from the lender.
If you have never done a short sale there is a someone on this forum called the ShortSalePro. I purchased a book from him that was VERY informative.
Again, my apologies if I misinterpreted your post.
lurking?
Definition of "lurking" from the American Heritage Dictionary:
"To read, but not contribute, to the discussion in a newsgroup, chatroom or other online forum."
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ShortSalePro,
It was intended in only jest and friendly banter. My most sincere apologies if I offended in any way. I find you posts incredibly informative and I am grateful for your unselfish contributions to this forum.
By the way, thank you for your book. It was very useful and informative. Please let me know if you publish another.
I NEVER allow the original owner to stay in the property. I know, I know, most of the time it is OK.
I am sorry for disagreeing with other more experienced investors on this forum but I have been bitten more than twice so now I am shy!
If the seller staying in the house is a requirement and the seller will not agree to other solutions I rather move on to another deal.
Buying and selling property the same day is not illegal.
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