Chances Bank Will Discount 1st - Posted by Brian(MD)

Posted by B.L.Renfrow on July 09, 2003 at 21:14:32:

No, it doesn’t HAVE to be in foreclosure, but a lender generally would be more motivated to agree to a short sale if it is in foreclosure.

If comps are $120-$130k (is that ARV or as-is?) and the guy only owes $61k, I doubt they would consider it.

But it can’t hurt to ask. Make sure you have lots of pictures showing the worst aspects of the property. A detailed, itemized list of (expensive) repairs from a contractor might also be helpful.

Brian (NY)

Chances Bank Will Discount 1st - Posted by Brian(MD)

Posted by Brian(MD) on July 09, 2003 at 15:38:59:

I am working on a situation where the seller needs to get rid of the house.
He an his partner went into the house thinking they could fix it up and make a profit. They apparently had no idea how to go about doing this. They paid to much.
$65k in Aug of 2001.
Today the comps in the area are 120 to 130. The housing here has gone way up since 2001 also.
The owners ran out of money, get this, AFTER ripping everything out. Kitchen, bathrooms, everything. The only actual rehab work they put in was to drywall the kitchen.
House is boarded up and condemned. Yard grown over. Wood awning collapesed over porch.
Things are not moving anymore on the hosue. Not at all. He hasn’t defaulted on the payments, but that might happen soon.
I am putting together a short sale package on this deal. Owner still owes at least 61k.
I can only imagine paying a MAX of 44$. Hopefully under 40k. I was thinking an initial offer of some off number like $35,569.
What are the chances the bank will discount the mortgage on this house if I get a letter of hardship outlining the impending failure to make payments, as well as the pictures of the property and an outline of the situation explaining how the house is worth much less now than when purchased?
I’ve read that the house doesn’t have to be in a foreclosure situation in order to work a short sale situation. I hope that’s true