I have a two different home owners and they want min.10K to sign the contract!!I said I can pay only $1000 for moving expenses and personal items in the house ,that`s it and lost the deals:( How much max. can I offer them
Are these homeowners in pre-foreclosure? Homeowners in short sale or foreclosure can’t profit from walking away or short selling - that is mortgage fraud. Be careful how you give the $1K for moving expenses. You have to be sure it is “off the books” or paid directly to their new landlord, etc.
It’s better to walk away from these homeowners if they don’t get that they can’t make money out of the deal. I’m sure there are plenty of other distressed homeowners out there to help out.
I agree. A lot of HO’s get on these forms and other’s like it to see just what a short sale is. I’ve even had people quote me from this forum not knowing that it was me they were quoting. The point is that they see us in here talking about paying homeowner money. There are some who will never get on line to research but will still try to get us to pay them to cooperate.
My experience is that these kinds of people will only make my blood pressure rise should I work with them. They are the ones who screwed up and made a poor decision, thus they are in foreclosure. Paying $10,000 to them just to leave is never going to happen. They are as abundant as anything else right now. Why would you want to pay a single cent to them when there are SOOOO many others to choose from. Besides, I prefer helping people who are grateful, not demanding.
GooD LucK! :beer
Totally agree,but tere must be some investors paying them big bucks because after I talked to this HO,he said he already found another investor agreed to his numbers!
Matt, you rock! I was wondering about the same thing, “How should I handle a HO that wants money?” I was told SATURDAY, (8th) by a "Foreclosure Consultant " (Maryland Law) that it’s not uncommon that the HO asks. But if you decide to do it, it’ll have to be outside of the agreement that she’s negotiating. Another guy over heard us and stated that HE purchased the 8x10 Storage shed from the HO of a short sale for $8000 as a “Bill of Sale”, no way tied to the short sale. I suspect the “other” investor did the same. It’s lawful, but is it ethical?
In this situation the facts of the transaction are actively hidden from the lender which makes it unethical at best and probably unlawful.
The question I would like to ask is, is it illegal to do a separate bill of sale with the homeowner? Would this be illegal? I do not believe it to be unethical since all you are doing is buying items from the homeowner, to put money in their pocket. If someone has a different understanding, please chime in.
OK, this is really confusing me. :banghead A short sale can’t be completed without the HO cooperation, correct? Obviously, they’re in need of help, and even tho he’s in despair, they want to know “What’s in it for me?” I say maintain/improve your credit, he reply “But I’m broke with no where to go?” What’s more ethical, giving him cash to depart and restart a new life! OR just get him out of debt and we take our enourmous profit? No one here is giving the money to a charity…(err well, not “all” of it)
Also, it can’t be illegal to buy something from another person. right? My neighbor hits every garage sale in a 50mile radius.
I had a tenant who didn’t pay his rent. When I told him he had to leave he said he had no family and no place to go. I didn’t budge and gave him the weekend to move out. He did not do so, so I came in and took his cat and told him he could have it back when he was moved out. That following weekend he had his dad there helping him move his stuff to his parents place. He really wanted his cat back.
The point is that people will always tell you the worst hoping you will give them something. My thought is this. If the homeowner isn’t making payments, and they know they are in foreclosure and that they will need to move soon after the auction, then there is no reason at all that they don’t have a few bucks saved up for a move they know is coming. So far I have yet to meet a person in foreclosure who doesn’t have a plan of action by the time I talk to them.
Most of the time the HO will cooperate just for the chance of avoiding the foreclosure going on their record. If they can walk away clean they are happy.
GooD LucK! :beer
Short sales are complex transactions that require expertise and patience. Whether you are an investor or a realtor, you SHOULD be compensated for executing a sucessful short sale. The lender pays your comission/fee from their recovery in the short sale, so you are not even collecting anything from the homeowner. If a homeowner makes you feel like some sort of extortionist for doing a short sale for them, then I say, let that guy go down in flames and go knock on the next door.
You can give/pay the homeowner money at your discretion, but just know that if that money or “help” is in any way construed as the homeowner having made a profit on the lender’s loss, it IS A CRIME - mortgage fraud, no ifs ands or buts. If you want to toy around in the “gray area” of this matter, then that’s your insanity. I suggest that if you want to avoid potentially being an accessory to fraud, you do the adequate relfection, discernment and CYA’ing.
I totally agree with you. I don’t go out and promise every homeowner move out money or any kind of money for that matter. However, I’ve had couple of HO tell me that they would like some money out of the deal. I tell them right up front that the bank will not allow that. And therefore, I can not promise them money. However, I tell them that when they are moving, I could offer to buy some items from them at a reasonable price, which would put some money into their pocket. I haven’t had anyone HO who bulks due to my objection to their request, with the option I present to them.
Thank you all for the insight! Hope it helped you also INVESTINGNJ. I really didn’t think about, the fact that if they haven’t been paying those “thousand” dollar mortgages, where has it been going? If they’re in default for 5-6 months, that’s well over $6K alone! That’s plenty of money for their move, even if it’s in an apartment. But honestly, I won’t rule out the fact reinforced by ICEBERG. Because some folks are paying ontime by using their reserve, eventually it’ll be gone and I think any asset manager will see the loan for what it is. Some cases like that, I’ll purchase an item or two to help them start over. All-in-all, I’ve come to the conclusion that’s it 's a judgement call, which can’t be made until you know alittle about the Home Owner! But be cautioned!
LMAO @ foreclosure negotiator. I can’t believe you took someone’s cat. You sir are hardcore.
You’re lucky you didn’t get arrested for that one :beer
I don’t blame people for wanting a few dollars when they go belly up. Particularly if it’s because of their business tanking or some other legit reason.
However, I’m sure most people have a friend or relative that they can go and stay with. It’s just money at the end of the day and life goes on. Life deals all of us hard blows at times, but if we’re lucky we live, learn and prosper from our experiences.