Im 13 months behind, can I short sale & make a profit in Cape Co. Missouri

Ok, I’ve been able to hold off BOA for over 13 months now, well over $12000 behind on a $112,000 mortgage. I’m looking to short sale it myself (with the help of friend/investor, :biggrin) I know Im not allowed to make anything from the sale, but will figure a way around that. :wink: I bought the house 3 years ago for $127,500, it appraised at $129k. Now 3 years later theres a similar house across the street listed for $129k, I would have thought my value would have went up some? Yes I know I need to do an appraisal, but not yet.
So, could this house be shorted to 50% for a sale price of around $55k-$60? And couldnt I sell fast for around $90k-$100k Any feedback welcome and I would love to talk with investors in and around my area of south east Missouri.
Thanks in advance.


First it is only likely that BOA will except only about a 15 to 20% discount below FMV for a short sale.

You can not buy the property as a short sale from your bank as the short sale has to be an arms lenght transaction.

Conspiring to defraud your lender is a Felony by state and federal law.

It is illegal for a buyer to conspire with the defaulting party to buy and resell the property and share any profits back with the defaulting party.

If the house is worth $70k today your lender will probable except an offer between $56k and $60k as 15 to 20% below FMV.

If the property is worth $100k the lender BOA is only likely to except and offer between $80k and $85k for the property.

If you have upset your lender the last 13 months it is unlikely they will except a short sale and instead press on into a foreclosure.

Now, Go do the right thing!


Well, this is a classic example of why you don’t want to purchase a house and then need to sell it 3 years later, yet if I understand your question correctly, it looks like you put down $15,500 on this house? If so, being 13 months behind probably means you lost your job? Has the house been on the market? If you put it on the market, yes, it might have to sell short, yet you cannot receive any proceeds, and yes, you do NOT want to do anything that resembles fraud.

Have you tried to set up any kind of a forebearance agreement, or a Loan Mod? This is a deal I could work on, or your investor friend could, yet you will have to be out of the picture. However, you COULD rent or lease it back. If you would buy it back at some point in time, that could prove problematic. I’d seek legal counsel on that.

A foreclosure is a law suit and the investors/banks who make these loans are not thrilled about losing their money. They do accommodate true hardship situations, and they MAY cooperate with a short sale though the situation isn’t all that much of a true hardship, but you want to steer clear of anything that looks like collusion or defraud.