CONTRACT TO SELLER?
Is making a short sell offer to the bank contingent upon your contract with the seller?
Will the lender request a copy of a signed sales & purch. with the short sale pkg?
I guess the bottom line is, should I neg. w/ bank on a foreclosing first before I actually put the prop. under contract?
Thanks all replies.
The only time(s) you would approach the lender before the homeowner would be in the event the homeowner had abandoned the property and was incommuncado, or, if you were seeking to purchase the mortgage.
When negotiating for a short sale, you must have complete cooperation from the Homeowner... it's the homeowner who seeks relief, it's the homeowner who requests short sale consideration, and it's the homeowner who must qualify for short sale approval.
You can assist and expedite the process... but you are only the Buyer.
It's the Seller's show.
Make sure to get a signed sales agreement ahead of time. Leave the amount blank. After you talk to lender you can fill the amount in. I usually have the homeowner do an entire short sale package the first meeting. (I find out who their lender is right away) Trust me, this will save you alot of time and energy later on. also make sure you get your notarized deeds at the first sitting. (Dont record yet!)
PC, I'm not in total agreement with your reply. Firstly, leaving the purchase sales price 'blank' is unnecessary. Determine the maximum price you are prepared to pay... and indicate that price in the contract. A preliminary conversation the mortgagee won't give you any real insight as to what they'll agree to accept, or even if the Seller qualifies for short sale consideration. Just make your offer subject to mortgagee short sale approval.
All supportive documents should be based upon what you are are prepared to pay.
Secondly, snatching a deed isn't an essential element to short sale acquisition. If fact, it may well jeopardize the outcome.
SSPro, thanks for the input. I've got your book in my shopping cart.
I have a long time friend who is approx. 30 days away from trustee sale. I was more concerned with whether I needed docs for the SS offer to mortgagee.
Generally speaking, What values do the lenders use for SS approval? There must be some hard fast % values. I've run though some posts here and seen varying opinions and rates.
If my agreed purchase price is well below these rates, what are the odds on acceptance by the mortgagee?
Big, each scenario is unique.
"There must be some hard fast % values. I've run though some posts here and seen varying opinions and rates."
There are no hard and fast % on value.
The short sale is predicated upon the mortgagee's perception of as-is, value, and their anticipated net recovery. Make them think it's worth less than their information indicates... and your "discount" will be greater. Your hopes rest with a shorted second.
"If my agreed purchase price is well below these rates, what are the odds on acceptance by the mortgagee?"
If your offer is too low, and can't be supported by data that can be confirmed... the offer will probably be rejected.
It all depends upon the strength of your proposal... it must be factual, compelling, and must articulate the benefits for mortgagee's acceptance.
I just got back from Jeff Kaller's seminar. He says the magic ratio is 80% of the BPO. If you offer less than that, they are inclined to take it. The thinking is that if it goes to REO, then they will spend apprx.20% on attys, realtor commissions, taxes, insr....to sell the property. So, in foreclosure, they'll take it at 80%. Not sure how true that is, just passing it on.
What does BPO stand for? How is it calculated?
Broker's Price Opinion. It is basically a short form appraisal by a broker who the bank calls on to tell them what the subject property is worth.
Quote:
On 2003-09-11 17:41, Julieann wrote:
I just got back from Jeff Kaller's seminar.
Did you learn anything there that you didn't already know?