How Do I Do This Short Sale?
This would be my 1st time doing a short sale. Here it goes:
The house is a 3/2/2 with garage converted to a living room. So the appraisal district square footage 1310 is less than actual area of the house, 1510 sq.ft
Owner bought house in 2005 for 117,000, with a mortgage of 88,350 @ 9.1% APR.
Selling $99,000.
Currently owes: $ 87,784
By the area comps 1300 sq.ft house sold for 130,000 on 4/2007
ARV : 100,000 for a quick sale.
REPAIRS: $7,000
REASON FOR SELLING: Owner had cancer, had to move in with daughter along with 2 college going kids. The daughter now has to pay 2 mortgages . Desperate to sell as a FSBO, cannot afford to pay a realtor.
As per my calculations:
Back taxes owed: $ 2600
Repairs: :$ 7000
Closing Costs : $ 3000
Realtor cost : $ 2970 ( around 3% for buyers agent )
Total : $ 15570 (to be able to sell and close)
From 99,0000 - 15570= $ 83430. So the seller will be short
$ 4354 to pay the mortgage company out of pocket.
The total money required from the seller to sell the house and close becomes:
15570+4354=$ 19924
Now tell me how do I approach the seller to let me shortsale. Language being a barrier in communication. THE HOUSE IS VACANT.
Ash
[ Edited by Smagnolia on Date 02/12/2008 ]
ok, good start. Offer the lender 70K, maybe less, and see what their counter comes in at. that is usually the value of their BPO.
What I do in situations like this is find someone to do a short sale, then list the property through a Realtor with an approved sale amount.
Trustee of the Trust back to the homeowner.
You may be able to get exact verbiage required from your county where you recorded the deed purchasing the property.
John (LV)
The first step would be for the owners to contact the exisitng mortgagees and formally request a loan modification. It is unlikely the principal would be reduced unless/until the loans were at risk of loss due to foreclosure, but the interest rate might be negotiated.
If the present owners were to try to short sale to you, they would have to demonstrate, at a minimum, financial hardship.
Short Sell must be an arms length transaction. What is your relationship to the home owners?