Do short sales really work?

I was wondering if lenders took these offers seriously?

Example - a 125k house with 100k left on the mortgage is behind and the bank has STARTED the foreclosure process. Let’s assume there are 60 days left to save the owner from foreclosure.

I speak with the lender and my first offer is about 85k (I am willing to go to 95k) to save this lender the headaches of the foreclosure process.

In general would any lender take the offers of 85k,90k or 95k seriously? Or would they just foreclose and bide their time?

Basically, I am asking from the generic viewpoint…is this a common practice the lending industry excepts as an option or is this just guru fancy talk that never really happens?

Thanks for all input,

Howdy Brian:

They do take it serious. A lot of deals are where the house is only worth the $85,000 and they owe $100,000. I tried several as an investor and could not get the deep discount that i needed to buy and fix and resell. I have seen many listed properties where the Realtor adds in the listing that the sale is subject to lender discount and approval, Most of them are in great shape and are at the current market value, discounted below the mortgage balance.

The worse the condition the better the discount as Realtors have a harder time selling junk property.

Hope this helps in a generic way

Thank you Ted,
Your input was helpful.

Am I guessing correctly that these deals will probably work better with smaller lenders that need to dump nonperformers?


yes they take the offers seriously. I negotiate around 40-50 short sales a month for other investors and you can only offer what you can offer in order to make a profit.
Tammy Elliott