I just got another Short Sale approved, but this one was more of a waiting and bugging game than anything else. Single mortgage that I had been working for quite a while. We had an offer that walked on us and then the mortgage switched from one company to another. They told me 14 business days for a response once it was submitted - try more like 45! But the Buyer hung on and now we have a whole 2+ weeks to get the loan done and deal closed!
The lesson here is that it happens to be our Buyer. So they were already set up with a Lender that I trust and I know can get things done in a jam. Not to mention they have some of the lowest origination and costs around! www.GoFCM.com - they are nation-wide so that opens up the window for a lot of people. They had already been working on the loan ahead of time and we will get it knocked out.
On a not so easy note: I also had a Short Sale rejected. The main reason was a BAD BROKER PRICE OPINION (BPO). The guy called me after he did it and informed me that he "would get it in as high as possible so that we would be okay". I think he thought that he was doing an appraisal or something... but I'm not totally sure what he was thinking! That gave the bank the wrong idea about the property and the price. And this was a 2nd BPO as our earlier one had expired due to missing tax returns. Our Owner actually had to go back to 2007 and complete all of the tax returns through current before we could start over on the entire transaction. We had it conditionally approved as well and now that bad BPO gave them the idea that it was actually worth 20k more (On a sub $100,000 deal)! I got the okay from the bank today and they ordered a new BPO.
A big part of the game is keeping deals alive - don't EVER give up on a deal until the day it forecloses. There's a difference between being rude to banks and demanding that they take the deal versus thinking outside of the box and working WITH the bank to get the deal done. Don't take NO for an answer, but don't take it personally when they do say "No". It's not dead yet - spend some time thinking and using your resources.
I hope this helps!
-JD WHITE, The Edge Realty
President, Managing Broker
JD@TheEdgeDoes.com
Wednesday, September 22, 2010
Tuesday, September 14, 2010
Latest Deal - APPROVED
Here's an interesting deal that doesn't happen a lot.
I just got a short sale approved that has a 1st mortgage and a 2nd mortgage on it. The house has been listed for several months and I have been dropping the price steadily to get an offer. I finally got one and was able to start the process.
Here's the amounts that were owed:
1st Mortgage = $137,000 (approx.)
2nd Mortgage = $55,000 (approx.)
It is listed at $129,000 and I cannot disclose the offer amount. You can see just from the numbers that the 2nd is the one taking the big hit on this deal.
I got the 1st approved fairly painlessly because the Broker Price Opinion (BPO) came in where we needed it to.
The 2nd was rather difficult. I had them getting $5,000 out of the deal which is pretty high for a 2nd to get. If the property goes into foreclosure, the 2nd gets a big fat -0-! The 1st was okay with them getting $5,000 and had put that in the approval letter that they sent me. Problem: 2nd COUNTERED AT $15,000!! Ugh!
Here's where a lot of negotiators throw in the towel and just call it a "dead" deal. That certainly wouldn't help my 95% + success rate, so here's how I took care of it.
1. I spoke with the 1st to see where their stance was. They were not budging on that amount. They informed me that the 2nd will see -0- when it forecloses in October. Lovely, huh!? They also informed me that the Seller would have to come up with the difference. So my wheels got spinning and I rephrased what they said and asked them if the Buyer came up with the amount, could we get a new approval with the purchase price reflecting that, etc? They said "fine."
2. I called the 2nd and told them that I "thought" I could get them $10,000 if they could get me an approval for that amount. They actually said yes and sent me over a letter agreeing to release the lien for $10,000.
3. I called the Buyers' Agent and checked if they could come up $5,000 plus dollars (the plus covers the slight change in commissions) and they were totally on-board as I had explained everything in full detail throughout the process. If the Buyers Agent knows what's going on at all times, it really makes it easier to get changes made if needed.
4. I went back to the first and asked them for a new approval with the purchase price being raised, the net being the same, and any information pertaining to the 2nd being removed. They got it to me right away.
Now we are working on getting it closed! I hope that helps some of you that are having trouble around a Short Sale with 2 mortgages - they sure can be sticky!
- JD White
"The Short Sale Guru"
THE EDGE REALTY
I just got a short sale approved that has a 1st mortgage and a 2nd mortgage on it. The house has been listed for several months and I have been dropping the price steadily to get an offer. I finally got one and was able to start the process.
Here's the amounts that were owed:
1st Mortgage = $137,000 (approx.)
2nd Mortgage = $55,000 (approx.)
It is listed at $129,000 and I cannot disclose the offer amount. You can see just from the numbers that the 2nd is the one taking the big hit on this deal.
I got the 1st approved fairly painlessly because the Broker Price Opinion (BPO) came in where we needed it to.
The 2nd was rather difficult. I had them getting $5,000 out of the deal which is pretty high for a 2nd to get. If the property goes into foreclosure, the 2nd gets a big fat -0-! The 1st was okay with them getting $5,000 and had put that in the approval letter that they sent me. Problem: 2nd COUNTERED AT $15,000!! Ugh!
Here's where a lot of negotiators throw in the towel and just call it a "dead" deal. That certainly wouldn't help my 95% + success rate, so here's how I took care of it.
1. I spoke with the 1st to see where their stance was. They were not budging on that amount. They informed me that the 2nd will see -0- when it forecloses in October. Lovely, huh!? They also informed me that the Seller would have to come up with the difference. So my wheels got spinning and I rephrased what they said and asked them if the Buyer came up with the amount, could we get a new approval with the purchase price reflecting that, etc? They said "fine."
2. I called the 2nd and told them that I "thought" I could get them $10,000 if they could get me an approval for that amount. They actually said yes and sent me over a letter agreeing to release the lien for $10,000.
3. I called the Buyers' Agent and checked if they could come up $5,000 plus dollars (the plus covers the slight change in commissions) and they were totally on-board as I had explained everything in full detail throughout the process. If the Buyers Agent knows what's going on at all times, it really makes it easier to get changes made if needed.
4. I went back to the first and asked them for a new approval with the purchase price being raised, the net being the same, and any information pertaining to the 2nd being removed. They got it to me right away.
Now we are working on getting it closed! I hope that helps some of you that are having trouble around a Short Sale with 2 mortgages - they sure can be sticky!
- JD White
"The Short Sale Guru"
THE EDGE REALTY
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