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5 Secrets To Short Sale Success
If you are a real estate investor you have a tremendous opportunity to create equity where none previously existed. If you're a realtor, representing those who are buying or selling properties which are about to enter foreclosure might help you survive a downswing in the real estate market. Secret #1 Submit a full package. Do not present an incomplete package to the mortgage lender. If you do, you can bet it will be placed on the bottom of the pile. You will need to include all the required information in the order specified by your mortgage lender and make sure every item is completely legible. Without following this information the chances of your short sale offer ever getting by the front desk, let alone the decision maker, are nonexistent. Secret #2 Have an appraisal done to get the current market value of the property and structure your offer accordingly. The initial offer is crucial to getting the short sale off to a good start. As you do more short sales you will become more knowledgeable with how various mortgage lenders work and how they respond to new offers in different situations. Virtually every mortgage lender will require you to raise your offer no matter how low or high it is. When they come back with knee jerk reaction make sure to pin them down as to how they came to this decision. Your goal is to have the mortgage lender order a brokers price opinion or a full appraisal of the property. Make sure the lender is not ordering just a drive by appraisal. Secret #3 Make sure you meet the real estate broker doing the brokers price option or appraiser doing the full appraisal. This may be the most essential part of making your short sale successful. Your job is to provide the person doing the appraisal or BPO any information that might influence the valuation in your favor to prove that the appraisal will warrant your offer. You should talk to the BPO agent or appraiser and let him/her know that the seller is in serious financial straights and is depending on the appraisal. You should have a list of repairs completed by a licensed contractor and have a good list of comparable sales showing that the property is worth substantially less than what the homeowner owes. All these items are critical but meeting with the person doing the appraisal or BPO is at the top of the list. Secret #4 The job of the loss mitigator is to get the case settled for as much money as he possibly can, so do not take no for answer or it will cost you thousands. Of course realizing there are some circumstances which will limit the amount the mortgage lender is willing to take is paramount. Reasons for this may be any of the following - PMI (Private Mortgage Insurance) Fannie MaeFreddie MacFHA guaranteesVA guaranteesThese mortgage loans are secured by governmental or private agencies and as a result are limited to the amount they will take for a property. If it is a conventional mortgage loan the settlement amount is arbitrary and set by the end lender or the investor holding the mortgage loan. If you are having to deal with a mortgage servicer instead of a direct lender, the negotiations will need to be authorized by the homeowner before any offer is agreed upon. Being persistence will determine your success or failure in negotiating prices which allow you to make a profitable transaction. Secret #5 Be ready to close on the home quickly, because once negotiations have completed the mortgage lender will require you to close promptly, usually in less than 4 weeks. If you are not able to close within this window you will have a very tough time negotiating an extension and will encounter difficulty negotiating with this mortgage lender or mortgage servicer in the future. This problem does not ordinarily arise if you are the end buyer, but if you are expecting to flip the home you need to be sure that your end buyer is prepared to close when you complete the negotiations for the home. One way you can stall is by slowing down the final negotiations until you have secured your end buyer. Sometimes this can really work to your gain when the loss mitigator calls you to see what is holding up your final acceptance of an offer. Many times you can get an additional reduction in the properties price. Certainly there is much more required in doing short sales, but these 5 secrets to short sales are important in getting a productive resolution to a short sale case. Remember, being persistent and polite works wonders in business, but do not leave any questions unanswered or you might just end up holding a larger than average lemon. Article Directory: http://www.articledashboard.com MortgageBreakDown.com is the #1 independant mortgage information website. With information written to help borrowers and homeowners escape the pitfalls of the mortgage and real estate industry. |
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