Need Help!! I think I'm about to make 40k on my 1st SS!!

Foreclosures, Short Sales, Tax Foreclosures
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Ok, I have been working on a property for about 6 months now. Due to divorce, the lady owes 340k and is about 30k behind. So with that, I have a short sale offer of 225k right now on the table. The bank recently sent out a BPO and the BPO came back at 300k!! Now let me tell you about this area. Wonderful school district, new houses being built all the time right around the house. These houses are selling for 380k. This house is 2 years old and in really good condition, just could use new paint on the inside and new carpet in the basement and bedrooms. Now we already have a cash offer on this property for 300k with 5k earnest money down. (The property was on the MLS for about 5 hrs and we already had about 6 people calling about it and 1 actually just sent in a cash offer at 300k with earnest money.) I am looking to go ahead and resell the property for around 320-330k which should be no problem being 50k below FMV. Now the bank recently told us that our current offer was too low and that they need at least 265k out of the deal. So here is where the questions come in.

  1. Now with doing a double closing, and by double closing I mean, I get a loan for the purchase price and then sell it the same day, I will have to pay two closing costs correct? So lets say if it costs roughly about 5% of the purchase or selling price for closing then I would have to pay roughly 13k on purchasing @ 265k and pay 16.5k on selling @ 330k. This is if I pay all of the closing costs. Is this correct on the way that I am thinking? Also, how much of the closing costs does the bank usually pay?

  2. Has anyone been able to assign a contract on a short sale? Lets say that if you have the whole “this contract is assignable” and all that jazz in the middle of your long contract within a thick paragraph? Could that work. Could the bank overlook that part and then you can assign the contract? B/C I have a buyer at 300k, and I can have the homeowner sign another purchase contract with this assigns in it and see if the bank accepts the contract, then I can wholesale the contract to the cash buyer and make 35k w/o having to pay any closing costs. Is this correct in my thinking?

  3. Should I keep negotiating the price with the bank, I mean should I budge in and go ahead with thier 265k or should I offer a lower 255k? I know everything is negotiable, but has anyone ever lost communication with a bank b/c of too many back and forth offers? Also, is 265k really their lowest or are they just saying that?

Sorry the posting is so long, Please help me in any way that you can. Thank you!!

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  1. Also, one more questions, if I am able to wholesale this deal. How exactly would this look on the HUD-1? Wouldnt the bank then see the HUD-1 and decide not to go through with the deal?

Thanks for ur help guys on this.

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Anyone here gonna try to help me out on this one? Any response would be greatly appreciated. Thanks.

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I can’t answer all of your questions, but since no one has replied…
I was told verbally from a negotiator that they were “not going to take less than $100K maybe $90K, I sent in a new offer of $84K and it was accepted…
Lender will usually pay for “standard seller’s closing costs”, the new buyer will pay for their closing costs, and since they are paying cash, it is not as high. Your estimate of closing costs seem very high to me, get a title company to do a HUD 1 for you.
Do NOT try to change the contract to make it 'assignable” you end up messing up, and losing the deal.
You will need to close on it first and then turn around and close on it again with your buyer later. The bank will only see the first HUD.
I hope I answered your questions. Good Luck

5

gigig,

Thanks, for your response. Now do you guys send in a HUD-1 on your SS offer? If so, where do you put all of the closing costs? I mean how do you know what the bank will pay and what to put on their side of the HUD-1?

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Be careful with your deal. Many lenders are going to require you to bring your own funds for a true double closing. Simo deals are almost history as I hear. I found a company that will provide the funds to you but it is at a price. But I paid it and have made over 50k on two deals so the fees were worth it. Not like hard money but they do charge. Only real catch is having to close with same attorney same day since they are bank owned properties they want to use their attorney and buyers lender want to use theirs…? There is money to be made. If you can’t find a lender you can contact me. I don’t want to post on the site as it is not allowed. If a moderator could reply and would allow it you can email me and I will give you referral. Glad to see these sites out here. I learned how to do my first two just from reading all of these blogs and info sites. Don’t pay for a kit unless you can’t find a friendly share.