Posted by jonah - FL on July 13, 2006 at 01:00:11:
I couldn’t quite figure what to do with the seller if the lender countered with a higher price for the short sale. I appreciate your help.
Guidance from people who have done short sales? - Posted by jonah - FL
Posted by jonah - FL on July 10, 2006 at 21:55:47:
I’m new at this and would appreciate some help.
The scenario is: A homeowner in foreclosure has no equity, and you want to put the property under contract and see whether the lender will do a short sale. You put a price in the contract with the homeowner which is considerably less than his mortgage balance and you will present this contract to the lender with your short sale offer. The lender agrees to do a short sale, but will not accept the short sale price you have offered. The lender "counter-
offers? a higher price to do the short sale.
Is there some smooth way you can plan ahead for this possibility? Do you have to go back to the homeowner to request that he initial the new, lower price you now want to put into the contract you have with him?
Any clarification will be appreciated.
Clarification - Posted by Ji Woslager
Posted by Ji Woslager on July 11, 2006 at 15:42:06:
When you present a short sale offer to the bank you have to have a signed contract, from the owner, for the amount you are trynig to buy the property for. In addition to many other things such as a hardship letter, financial statements, tax returns, repair lists, photos, ect, ect.
If the loan balance is 110K for example, and you want to offer 75K as in my above post, then you have to get a signed contract from the homeowner, at that time … BEFORE you submit the offer to the lender … for the 75K.
Hope that makes sense. Just explain to the homeowner that there are a lot of costs involved, and go over whatever repair lists you might have, expenses (closing costs both when you buy and resell, agents commisions, holding costs, ect, ect) among many other expenses that can occur. Also, explain to them that getting the house sold to you will stop the foreclosure from going on their credit history and that is the ultimate goal for them.
A lender will not allow ANY money from a short sale to go back to the seller. You can mention that as well if they want some of the proceeds … its the lender thats the bad guy … not you 
Re: - Posted by Ji Woslager
Posted by Ji Woslager on July 11, 2006 at 15:36:57:
Well … you wouldnt be going back to the homeonwer to request a new, LOWER price … the price would be HIGHER since the bank sent you a counteroffer.
If you place a bid at 75K for example, and the bank counters at 90K you dont go back to the bank at 65K, you either go up from your initial 75K or reject their offer completely.
So if you got the homeonwer to sign a contract intially at the 75K it shouldnt be a problem getting him to sign one for 80 or whatever you want to counter at.