As we all know, many short sale efforts come up “short” and the the property still gets sold on the courthouse steps. My question to you all who have tried and failed to save the property is this - how much did you charge the homeowner for your efforts?
How much is your time worth? Do you charge a % of the value of the house, or a flat fee? Gas money? 
Just looking for some opinions and stories on how much investors charge in different parts of the country…
NOTHING! ZIP! ZILCH! NADA!
I have NEVER, EVER charged a HO for assisting them in foreclosure. Maybe that's why I have an above average closing rate. LMR's seem to be more respectful and willing to work with me because I make it perfectly clear that I am here to help the HO and the lender.
In some situations I still help out both parties and I get paid nothing to do it. Yes, I work for free!! It's a means to an end. One deal in particular I just did recently paid me nothing. The HO got out of foreclosure and the lender got paid most of what they owed. However, the next time I spoke with the LMR for that lender they were almost excited to work with me again. This time I made $60 on the deal.
Don't take this the wrong way. I'm not saying you should stop charging a HO, who obviously is hurting for finances or they wouldn't be in foreclosure to begin with, a fee for ATTEMPTING to do a short sale. If you do that then I have no one to make look like the bad guy when I inveigle the LMR's. After all, how many jobs do you get paid for TRYING to do something but failing at it but still get paid?
Personally I like to help people rather than take advantage of them.
Kick em while their down…not my style either.
Your main goal should be to help the homeowner & bank.
“Help others get what they want, and you will get what you want” ~zig ziglar
*oh…and many states have passed VERY specific laws about this.
Hi Matt,
After all, how many jobs do you get paid for TRYING to do something but failing at it but still get paid?
[]Doctors[]Lawyers[]Nurses[]Consultants[]Professional Athletes[]Tech Support[*]Seminar Gurus
With trying to juggle a job, family, and REI, I consider my time valuable. Every hour I’m doing REI is an hour I’m taking away from my kids and wife. I believe there is an extensive thread on balancing all this in the archives, which is good reading.
I guess my point is with the price of gas these days and the cost of time, I have to be fair to myself, my family and my business. I need some type of compensation (even if it’s just gas/dinner money) when I have to drive all over my county and spend the time negotiating on the homeowners behalf to help them save their house and credit when I know that many of my efforts may fail.
Do you see my point? Anyway, I was just wondering if others feel the same way I do and what their rates might be.
I respect your business model, and good karma does indeed pay you back eventually - I wish you the best!
I concur with the time lost. But again, what you have is a
very positive client base with a strong potential for referral.
All it takes is a few deals a year that pockets you big $ to
run your life.
SS are time consuming. Is hard esp with a divorce situation
and on top, its even hard with homeowners who don’t want
to do a thing to get back up on their feet and move on.
Perhaps running multiple deals simultaneously is the way to
go, hoping to average out for an income stream.
-krish
what service are you actually providing? this site is notorious for slamming licensed agents and trying to undercut their pay for providing a service, if it don’t close why on earth should a non licensed investor who is looking to get a deal charge the HO? At least an agent has a legal fiduciary duty to whom they are representing.
Wasj-
The service any investor is providing is a possible solution to the homeowner’s problem, wouldn’t you agree?
In this particular case, it’s preventing the homeowner from foreclosure and an even lower credit score. Don’t get me wrong here - I don’t condone folks charging hundreds of dollars to just try. I would never “kick 'em while they’re down,” either. I have never charged for my services, but was wondering if others had.
I can see that everyone who has replied so far doesn’t charge anything. This is good feedback, and exactly what I was looking for - thanks.
With trying to juggle a job, family, and REI, I consider my time valuable. Every hour I'm doing REI is an hour I'm taking away from my kids and wife. I believe there is an extensive thread on balancing all this in the archives, which is good reading.As for valuable time...
Here is a list of just my businesses. Forget that I have a family and a life outside of work...kind of:
[]Property Management[]Mortgage Company[]Title company[]DBA for Short Sales company[]Model Management Company[]Model Marketing Company[]Computer Company[] An online real estate website still in design
I’m not tooting my own horn here, I just want to put things into perspective for you. If I am able to do it under my situation then anyone can. And for the record, I got started with nothing. The key is to be organized and to ask people for help. I would not be where I am today if I didn’t ask questions and if a few people didn’t guide me in the right direction.
I go a step above and beyond most people. You have your so called GURUS out there trying to sell you their “Packages” or “Boot Camps” for a ton of money right? So I decided that I was going to help other out much the same way someone else helped me once. Check out the link below my name to see it. It is all 100% FREE because it should be.
Krish says it best.
what you have is a
very positive client base with a strong potential for referral.
All it takes is a few deals a year that pockets you big $ to
run your life… Perhaps running multiple deals simultaneously is the way to go, hoping to average out for an income stream.
It may take 3 months to do a deal. But that deal can pay more than 80% of America makes in a year. Also, everyone I have ever talked to about doing SS’s has told me to do multiple deals at once. 10 is a good number to shoot for.
what service are you actually providing? this site is notorious for slamming licensed agents and trying to undercut their pay for providing a service, if it don't close why on earth should a non licensed investor who is looking to get a deal charge the HO? At least an agent has a legal fiduciary duty to whom they are representing.
You bring up a good point. Technically speaking: in order to LEGALY do short sales you are supposed to be licensed to practice Real Estate. Too many deals get turned upside down because the people doing it don’t know what they are doing. So the gov says you must be licensed to buy or sell property that is not your own without a license. I am able to get around this law because I own other real estate businesses…and my brother is a realtor so he makes sure every deal I do is legal and done right. About half the time he gets the commissions from the sales for listing the property I do SS’s on.
You can also put the properties that you are doing short sales on in a trust. Record the deed in the trusts name and perform the SS on behalf of the (beneficiaries) borrowers as the trustee of the trust (me). The borrowers can’t receive any proceeds from the SS but as the trustee I can disperse funds in excess of the net to the bank as necessary (to my LLC as a fee for a successful SS deal).
Perfectly legal, ethical, and keeps it simple. I think…
I don’t think that anyone deserves a ridiculously high fee for performing and negotiating a short sale maybe between 3-5%. Anymore than that and you are equity stripping IMO.
I totally agree with the previous comments about people “deserving” to be compensated for not completing the deal. This is nothing more than sales, does anyone else in sales get compensated for almost closing the deal? NO.
Not realtor bashing at all, but I run into this all the time. Agents thinking that they deserve something because they haven’t sold a home for six months. I procure a buyer and they think they should get a piece of the deal.
I’m kind of with Matt, DMiller, et al. If I am not successful then I don’t feel I should be paid.
I do feel that my time is precious. Especially since I am a single mommy, have a full-time job and run a few businesses.
At my JOB, I get paid to do a job. If I don’t do the job, not only will I not get paid, I won’t have a job. Also our organization awards us above salary based only on our financial success. No success, no bonus.
In one of my other businesses, artist and production management, it is basic math–15% of nothing equals nothing.
Lastly, if I fail to help the homeowner then the homeowner is still in trouble! Compounding my failure to help them with a bill is in my opinion (would-be flamers, notice I said “my” opinion), predatory.
Just my two drachmas.
I am in over quarter million dollar debt (if you have read my posts) so to have someone come to me asking for a fee would send me over edge, considering my property has me on edge already.
Not sure if anyone noticed but the info here is “FREE”. Many of you have completed or nearly completed your SS b/c of this “FREE” forum. Many of you have paid your bills from REI due to this “FREE” forum…
Just my two lil’ copper thingys they call pennies.