I’ve been reading up on short sales the past few weeks and still have a few questions
• Not including marketing and travel costs, can anyone give an estimate as to how much money is usually laid out during a short sale (do you pay for comps, rehab estimates, title search, deposits, etc?)
• It is in my best interest to perform the short sale using a separate entity, correct? Do banks have problems with this?
• Banks don’t allow you to assign short sale contracts, correct?
• If I plan to do a double close on a property, will a seller/bank usually require me to show proof of funds? If so, what are ways to deal with this?
• Is there any “lag” risk? For instance, if I sign a P&S contract with a seller (subject to a short sale), unpaid mortgage payments and additional fees will continue to accrue and the bank is owed much more than when you first signed with the seller. How do you ensure that these accruing fees don’t make the deal unprofitable? Is this part of the negotiation with the bank (negotiate that anything above X, including newly accrued charges, will be written off)
• The book I read focused more on shorting only the second mortgage and paying the first mortgage in full. Is this how most people do it? From what I’ve read on message boards, it looks like most investors try to discount BOTH the first and second mortgages.
• Does anyone have a suggestion for a simple website template? All the REI templates I’ve found online seem pretty expensive for a basic website.
• One other major question is about building my buyers list. The REI club I joined meets once a month, but the last couple of meetings have been cancelled. Can anyone suggest good ways to build a good buyers list without spending too much money?
As you can tell from most of my questions, keeping costs down is one of my primary concerns. I know I will be spending money on marketing, but I’d like to keep other costs down as much as possible.