We apologize, but the forums are closed for new posts. Click Here To Join The Unemployables Facebook Group

Welcome, Guest. Please login or register.
February 03, 2023, 03:23:48 am
Home Help Search Calendar Login Register

Welcome, Guest. Please login or register.
February 03, 2023, 03:23:48 am
Home Help Search Calendar Login Register

Author Topic: Wolesaling a short sale  (Read 3809 times)

Offline htjohnson

  • Member
  • *
  • Posts: 24
Wolesaling a short sale
« on: September 29, 2009, 05:22:36 pm »
Hello everyone

I just spoke to some one who has a short sale approved by the bank and call to see if i was interested in buying it.  my sole intentions will be to take the short sale under contract with my contigeincies of course and whole sale to an end buyer. what options can i consider in doing this deal?

1. can a short sale be assigned.
2. will i need to provide earnest money? the seller is not entitled to any income right?
3. shall i set this up as an a-b-c deal?
4. what time frame is typical for an approved short sale. i was thnking having a 15 day inspection clause in the contract.


any advice will be helpful, thanks

Offline latoyarvs

  • Member
  • *
  • Posts: 15
Re: Wolesaling a short sale
« Reply #1 on: September 29, 2009, 06:50:38 pm »
To answer the following questions, when you are working with Short Sale on a hole its a long waiting period..

Short Sale are not assignable but you can get an end buyer, tell the bank or the RE Agent that you are not able to perform and will need to back out but that you have someone else who is interested in taking over. You would have already talked with this end buyer and worked out the deal and your fee. The buyer then pays you the assignment fee and you would then give the agent or the buyer the property info. The Earnest money can come from the end buyer if they are serious.. Time frame vary from 60+days.. Its a long time>>>I hope I was able to assist you with your questions..

Offline TMCG

  • Member
  • *****
  • Posts: 1056
    • noobdogs.com
Re: Wolesaling a short sale
« Reply #2 on: October 02, 2009, 09:24:38 pm »
agents work too hard to (excuse me) f*ck around with someone who can't buy a property.

"wholesaling" a short sale is a joke.  don't waste real estate agents time.

if you want to play around with someone's home - go directly to the unknowing owners.

and any agent who is stupid enough to get mixed up in that doesn't know what they're doing.

SHORT SALES - are just like any other sale - a majority of banks (there are exceptions) - but most look for fair market value.

what are you going to make off of a fair market deal - purchasing a property and assigning it to an "end buyer"...unless the agent has priced thehome too low, in which case, the bank will see that the property is being sold TOO LOW - and thus reject the short sale on the basis that
A. the owner is probably getting something out of the deal
B. the owner is trying to rip off the bank.
C. basically the bank is getting screwed out of money.

Short sales - are about banks and their investors.  i love the guys who call me and tell me how they can get short sales for .65 on the dollar...it's ridiculous.

do some banks just give them away - yes they're out there - but they're few and far between - you've got to know the ones that do - like option one - my goodness, they'll accept ss for like .40 on the actual dollar - like fair market value is 100k and the deal is for 40k - just stupid.

New To Investing? Check Out
http://tomsresource.com/ - Tons of Links and Cheap Books.

Offline obiwan1250

  • Member
  • ***
  • Posts: 144
Re: Wolesaling a short sale
« Reply #3 on: October 03, 2009, 09:15:35 am »
TMCG writes - "SHORT SALES - are just like any other sale - a majority of banks (there are exceptions) - but most look for fair market value."
Oh really?   Just like any other sale?  I beg to differ.

I've been an agent for a collective 10+ years.  I've been working on short sales for about two years, but not as an investor until mid-2008.  Working the A-B-C transaction is not at all like "any other sale". 

This is a sophisticated form of RE investing -- it's arbitrage.  This biz is not for the faint at heart (you need a cast iron stomach to deal with the stress), it a LONG, LONG drawn out affair, dealing with finicky banks and power-hungy L/M's; it's not a piece of cake, as some SS gurus would have you believe, and you can waste hundreds of hours and make nothing in the end on a deal. 

Just keeping up with the required updates for some lenders would doom the average RE agent, and many investors -- I've had 5 Loss Mitigators on just one deal, been working on it for 15 months, and have never had a single soul say "yea, neigh, or maybe" to my offer.  The file has been closed without reason or cause multiple times.  They will do so without a moments notice to the investor/buyer on the deal.     

No one likes to lose thousands and thousands of dollars, so a bank has an asset management committee to make absolutely sure that accepting a SS is their BEST course of action; it is NEVER their only.    Some are easier than others, for sure.  But to say a SS is "just like any other sale" TMCG, seems to be misleading for novices who are considering this area of RE investing.  They will be in the valley of the shadow of death as an investor, and more often than not, discover the battle is much, much more difficult than they ever imagined.   

Of course, maybe I'm doing it all wrong, but I've had many a veteran state that it's complicated.  Fortunately, it is a numbers game and if you're working a lot of files, some will begin to pay off.  IMO, a 67% success rate would be high. 

So, if you're not prepared to work the business nearly full-time (either as an experienced pro who can work the biz 20+ hrs per week, with a cadre of assistants processing the files, negotiating, resolving the problems, etc), prepared to devote hundreds of hours to studying what it takes to succeed, I wouldn't even get started. 

If it's so easy and lucrative, why are SO MANY SS experts hawking programs instead of closing deals? 

As for the average REALTOR, he/she doesn't stand a chance to work these deals, as an investor.  As a REALTOR with a retail buyer, sure.  Yet many of our peers can barely handle a simple retail sale, let alone the complexity involved with arbitrage of a A-B-C transaction.   

There is a reason the investor makes 3-10 times what either agent makes in this kind of a deal.  They earn it.  To believe otherwise is foolish. 

"Money for Nothing" is a song; it is not reality. 

« Last Edit: October 03, 2009, 09:28:18 am by obiwan1250 »

Offline htjohnson

  • Member
  • *
  • Posts: 24
Re: Wolesaling a short sale
« Reply #4 on: October 05, 2009, 10:08:07 am »
thanks guys, that was very helpful.

Offline Summit

  • Member
  • ***
  • Posts: 189
Re: Wolesaling a short sale
« Reply #5 on: October 05, 2009, 01:26:57 pm »
That was a fun argument. Reminds me of my ex!!

I will just stick to the questions..

1. can a short sale be assigned.

Of course the short can be assigned. The problem is that will take just as long to assign it as doing the short sale. So not a good idea.

2. will i need to provide earnest money?

Personally I would never do a dime of Earnest money on a short sale. I would sign a promissory note. (That can be assigned as well) Make it so the Earnest money will be delivered within 5 business days after the acceptance of the short sale.
 
the seller is not entitled to any income right? Not really some lenders will offer cash for keys.

3. shall i set this up as an a-b-c deal?

Can if you want I am not a big fan of that. Title seasoning issues there are better ways

4. what time frame is typical for an approved short sale.

As little as 15 days and as long as 75 days if it takes longer then that there is a problem.

See how nice this is when we all get along... :biggrin
Time to change the old image. If you want to really get into Real Estate the link below will get you everything you need.. From leads to training!
www.newideasinrealestate.com

 




SMF 2.0.15 | SMF © 2017, Simple Machines