My best guess on the property’s AS IS value is probably around 120k. It’s built in 2001.
I know 50k sounds a little low…but hey, won’t hurt to try!
The Agent says that he can get the owner to sign any paperwork needed BUT refuses to give out owner’s contact info.
When I talked to him about short sales, he said he was familiar, but only 5 minutes later, he told me “please dont call the lender any more, deal with me and I will tell u everything” - at this point, I had to explain to him again the whole short sale process.
I will try your idea of a conference Call to go over the sales contract, i like that!
Vacant home, owner has fled out of state to unknown location. Owner listed home for sale with realtor who says the owner simply wants to be rid of the home.
Home info: 4 bed / 2.5 bath / nice part of town
ARV: 160,000
Loan PayOff: 150,000
Max Repairs: 25,000 (being very, very liberal here)
Leins: 30,000
Agent Fees: 5,000 ? (not sure on this)
Mortage Payments: have not been paid in over 3 months.
Since this is not a foreclsoure, can I still use the short sale method?
Perhaps the most important number when trying to prequalify a short sale candidate is the subject property’s as-is, fair market value. ?
You’ll also need the seller/mortgagor’s cooperation throughout the process, and, depending upon the type of mortgage loan, short sale criteria might require owner occupancy.
Yes - they are indeed late in making payments - according to listing agent, the owner has not paid in over 3 months.
Also, the agent faxed to me today a letter from the Mortgage company’s Loss Mitigation Dept. approving a sale of the home!
I think I have a real possibility here…but I dont have contact directly with the seller and property is NOT under foreclosure yet.
Im not sure if I should wait for the lender to foreclose and im not sure how I can get in touch with this owner… agent is unwilling to give out owners info
Re: Will this work? Short Sale - Posted by B.L.Renfrow
Posted by B.L.Renfrow on December 17, 2003 at 16:57:04:
“… agent is unwilling to give out owners info”
That’s priceless. Just how does the agent think he’s going to get paid if he obstructs your efforts to arrange a short sale?
Not that it can’t be done, but the fact you have an uninformed or uncooperative agent in the picture will make this more difficult for you. Why can’t the agent contact the owners on your behalf? That’s his job! If he doesn’t understand the short sale proposal, then you need to be present when the offer is presented (by conference call, if necessary, if the sellers have left the state).
However, with the numbers you’ve given, I seriously doubt the lender would entertain an offer of $50k with a loan balance of $150k. You don’t mention the current as-is value, which is important. If you can show the lender that they wouldn’t net more than $50k by foreclosing and selling, you might get somewhere.
As I see it, your choices are:
Get it under contract, which would require the seller’s and the agent’s cooperation, and make your short sale proposal to the lender, with appropriate documentation.
Offer to buy the note at a discount instead of doing a short sale. Some lenders will sell their notes, some won’t…you won’t know unless you ask. The advantage of this is that it does not require the seller’s cooperation and it’s generally quicker. With either a short sale or note purchase, you will need quick access to cash, however.
Wait until after the foreclosure is completed, then make your purchase offer through the broker with whom the lender lists the property.
Also, if you buy via a short sale, you’ll need to deal with the junior lienholders. If you bought the note, you could foreclose them off. If you buy it as a REO, the liens will already be eliminated by the lender’s foreclosure.