Does this sound like good news?

Foreclosures, Short Sales, Tax Foreclosures
1

Hi.

I’m going through a short sale on my home with a very decent and professional investor, and the house was valued at $195K. The original offer was $130K, the bank said no, so he offered $145K. They still said no, and late last week he submitted a final offer of $165k. I just got off the phone with him, and he said the LM officer was going to forward the offer to the decision-makers, and this time he has a good feeling they will accept.

I asked what he did differently this time, and he said that he’d been submitting articles on how bad the market is here (SW FL) and the bank is not local, so they may finally be realizing that they won’t get much at auction. (No sale date as yet, btw, but now 2 payments missed). He also opined to them again that the BPO was too high compared to the cost needed for repairs. The LM officer gave him a tentative closing date of Oct 31st, and that’s what gave him the good feeling as they had never even submitted the offer before, they’d just given him a flat-out “no”. He explained that they have a base offer they won’t drop below, which I understand is around 80%? They told him originally that they wanted $180K.

Anyways, while I do trust the investor, and this is the best news I’ve had so far, I also don’t want to get my hopes up too high just yet. He said I just should know one way or another by this Friday. I suppose what I’m looking for here is the opinion of some experienced investors who are familiar with this portion of the process. Any advice/valium/vodka (!) would be much appreciated. :slight_smile:

Moo.

2

What the did the investor say who was going to do with your home after he purchases it? If he says he going to resell, he may not end of purchasing because he has barely any equity, so be ready.

What are the contingencies on your contract?

If he plans on renting than I think you should be fine.

Right now he is leaving himself with 30k in equity not including costs and any repairs associated with the property.

3

Hey Moo,

The value of 195, is that As-Is? Because that is an awfully slim deal if it is what a nice home is going for.

4

It’s “as is”. The home was mangled a bit by hurricane Wilma and so doesn’t look great on the outside, not to mention various problems inside.

Moo.

5

What is your estimated $ of repairs? You are already at 85% LTV and I have not heard of any Investors that are willing to purchase a home with that high of a LTV. I have a family member living and investing in South Florida and he told me yesterday that the market is flat/declining and Investors are occasionaly buying homes, in almost perfect condition for no more than 80% LTV.

The previous comments are right on the money… find out the intentions of your Investor. He may back out at the last moment. Hopefully you have the proper contingency clauses in your contract that protects you if this should happen.

Please post your results and best of luck to you.