Short Sale Question - Pre Bankruptcy - Foreclosure

Foreclosures, Short Sales, Tax Foreclosures
1

I received a call from a person who responded to a bandit sign looking to sell his property…
Finally…

I have asked him many questions… and his response is he is contemplating Bankruptcy but dosent really know what to do…
He is 5 Mo. Behind on Mortgage Payments which are like now 1800.00 per mo…
This is a 80’s dbl wide Trailer on Approximately 1 Acre of Land…
He said his Balance he owed was 147K before all the fees… From AMC formerly Ameriquest…

because the Property is a Dbl wide and payment 1800 per mo… the sale / or Lease Option would be much harder… and wouldnt work for this… ( and he’s 5 Months behind )

The Land…
I figure a lot of approx. 1 acr. is going for @ 80-100K ( 90K would be for a quicker sale… or 80k even faster say 60 Days or less)

The Dbl Wide trailer needs a about 2-5K in repairs to make nice and clean again… ( Ready to sell & Repairs…)

I can only find comps for single wides and they run 40-60K with no lots with approx one acre lots @ 150K

So Im figuring that is about what he owes for his property so would need to do a short sale with AMC to make this worthwhile for new buyer, investor, or for Filp or L/O…

What would the typical short sale discount be for a property with AMC ? This i do not know how to gage… is it 50 % ? Is it 65% is it 70 or 80…?

I know from the field card the appraisal was 214K but not sure when that was last… since property values went down like 20 % here in CT since 2005

The Assessed Value from Street card is 149,700 which is generally 70% …

What would I be able to do with this deal… Im thinking short sale…
should I try to talk him outta Bankruptcy…? Leave this property out of the Bank Ruptcy…
Let him file Bank Ruptcy to buy more time for him and us…???

Again, What would the typical short sale discount be for a property with AMC ? This i do not know how to gage… is it 50 % ? Is it 65% is it 70 or 80…? What should I be offering the Bank/ Lender in this case…?

So I could resell to investor or enduser in time… Id reather be in and out by flipping…

I know i will need Auth to Release… and Limited pwr of Attny…
What else…?
Do I get a deed ? do I put into trust? get a equity split agreement…?

Any advice from you experienced shortsalers and savvy investors would be appreciated… and most of all i’d love to be able to help him outta foreclosure…

Please Reply ASAP… Time Sensitive

Thanks you all in advance…
Mohegan

2

here’s my 2 sense…

Look at the property, take pictures of everything (40-50 photos). Take them home look at them, think about what you saw at the property. Then ask yourself this… If the bank sent a broker to give his “2 cents” of the “as-is” value of the property, what would be your honest answer of his price??? then take your honest estimate of his opinion and times it by .82 (82%).
ex. BPO= $130,000. x .82 = $106,600.

This is realistically the ballpark of what the bank is going to want. Doesn’t necessarily mean they wont take less or may want more. (depending on how you present your offer to the bank or the LM REP) THATS NOT WHAT YOUR OFFER WILL BE BASED ON!!! Now that you have a “ball park figure”(based on estimated BPO). Think about your exit strategy… how are you going to make your money?? what do you have to buy it at, in order to sell it quickly?? once you have a general Idea and have a GAME PLAN and BACK-UP PLAN for the deal then take it to the next step…

get authorization to lender… and get the TRUTH about his loan. interest rate, backed payments and arrears, attorneys fees, BASICALLY AN “AS OF TODAY” of what is owed. Once you have all those numbers put together NOW you can determine what you offer is going to be… you should not put together an offer until you have the truth about everything…lol (he is in denial) speak “denialeze” with him…

…see how you do this is, you put together a case and present your offer to the bank. I feel ALOT of investors pursuing short sales think this is about numbers. IT IS ABOUT YOU PUTTING TOGETHER A PACKET AND STATE FACT, AFTER FACT, AFTER FACT about the property and homeowner.

Do you honestly think the bank has hired a negotiator that is dumb???
The bank hires people JUST LIKE US, except they work for the bank and not to mention do hundreds of deals a week.
(understand there job is to get the most $$$$ for the bank)
So on your first call tell them you are in this deal for a win, win, win situation for all involved.

I can sit here for hours explaining numbers to you, but IF YOU DONT HAVE THE CONCEPT THEN WHY WORRY ABOUT THE NUMBERS.

Basically what I’m saying is… MAKE the bank believe this is WHY you are buying the property for this price, and here are the FACTS backing my price.

3

Thank you for you detailed information… So you believe 82% is what the bank would consider…
I will take these pics for the bank…? or for my self…?

I was told before that Im am to tell the bank that I am only assisting them with the sale of their property and that im not the one buying…

His amount owed is supposedly 147K so 82% would be $ 120,540 This is probably what that bank would be looking for… hypothetically…

How much lower do you make offer then…

In my preliminary investigation i figured 90-100k - or even 80-90 for quicker saler to end user or to investor… this way inv could get 20+K and possibly a refferal fee or assignment fee for me of lets say 2-5k

Although, Im having trouble finding good comps…

Thanks again
Mohegan

Bring on your ideas investors…

4

Mohegan,
If you read in detail what ray is telling you is( after looking all the pictures)what do you thing that will be BPO(broker price opinion)not “the supposedly amount owed”

5

Just out of curiousity what town in CT is this located in?

6

sniffsniffsniff
The shark smells the blood. :biggrin

7

Nah, I don’t wanna steal his deal. Just wondering where he’s finding mobiles with a lot of land. There aren’t many in CT period and most are in small parks. Frankly I wouldn’t want to have anything to do with a mobile if at all possible, they aren’t exactly popular in this state.

8

depending on the loan product.
you need to know what the loan product is before yo uput in your offer.

the 82% rule is for FHA

there is also fannie mae, freddie mac, va, conventional.

people really need to stop guessing what to offer the bank.
find out what the loan product is and then you’ll knowwhat to offer. :banghead

9

There is no % rule.

You offer them what you think you can afford, if they say no, find the next one.