I have access to the MLS and was wondering if short sales listed on there were worth putting offers on? Are properties already listed on the MLS typically harder to turn into a deal?
Thanks
the problem with doing shortsales on MLS is that you have to work with a realtor… and that can be complicated to say the least…
if you are going to do shortsales find your own private deals there are lots of them out there…
Most realtors will just blow the deal…
- find a pre-foreclosure person that you can Work with.
- do the shortsale with them.
- make your money
Do yourself a favor and stay away from the MLS and just do private… It will be way more rewarding and you will do more profitable deals…
Let the agents do there thing and dont get invovled with them.
I second that opinion but for a different reason. Most secondary market investors now use the minimum threshold analysis to approve a short sale rather than the REO vs. short sale comparison analysis. So making sure that you have the minimum threshold will allow your offer to be less and still obtain approval. That is because you do not have to pay broker fees.
My firm has two books that can help you from start to finish to lead you by the hand through the short sale process from finding properties to obtaining the bank release documents and closing. They are designed for the beginner and really reasonably priced.
Also, you can get ideas on this forum for marketing and creative deal-making.
If you need help, we also provide coaching designed for your needs and budget.
If you want us to handle the case for you, we can do all of the processing and dealing with the banks if you wish.
So, bottom line is if you avoid the MLS, you get to avoid broker fees and make it easier to reach the minimum threshold percentage. You can learn everything you need through our publications, or use our services to do it for you, and prepare yourself to make good money.
As a former investor turned licensed real estate broker, I agree with the other two people responding. A lot of real estate professionals have no idea how to work a short sale and you can profit more with an owner cause you don’t need to deal with broker fees.
Instead, find a real estate agent to work for you and have them rebate their commissions as you need to have a listing agreement and have the property listed on the MLS for two reasons: Some lenders require the property to be listed on the MLS and you can find your retail buyers while negotiating the short sale.
Good Luck
This topic has been heated so many times and debated…
I am going to send the last and final fag up as every agent will stab me in the heart for what i am about to say… with that said here we go:
DO NOT use agents to shortsale a listed property for you… you will not get the maximum discount, they never realy go to bat for you bacause you the investor have so much more to gain then they do, most agents if you get a smoken deal will resent you for it anyways, its just a bad idea no matter what anyone says…
This is how you get the good deals:
- find a private home owner behind on there mortgage (its not that hard, lots out there…lol)
- work with them one on one to do the shortsale
- be in direct contact with the bank. (if you dont know how to do this LEARN!!! there are 25 course that will tell you how to do this and its pretty easy)
- you be in control and NO one else (the deal will blow up if you dont)
- do the deal, help a home owner out, move on to the next one… Its not that hard!
- understand that you will not always get the big discount. 1 out of 20 is still ok if you make $50k plus on each deal, so get 30 files going all at the same time, 60 days will go by and you should have a check in your hands.
- you can use an agent if you want but you will regret it because it will just be a waist of time… You will see… Its not agents are bad, its just the system just doesnt work when they are involved.
some time ago i tried to use a broker. I tested this thoery that you could do a shortsale with an agent, this is how it when:
I personaly did 45 files that were private, and 125 files with agent(s) 5 of them…
At the end of the 6 month period I discounted 6 of the private file to 35-45 cents on the dollar.
Not one of the 125 file discounted below 90 cents on the dollar and not one with the agents ever closed.
This lead me to the understanding that even though it is possible to use agents to shortsale it is not in your best interest to use them, because you can do better on your own!
hope this helps you out… my information is below to if you think of anything!
Great Information guys!
How would one handle situations like in the state of Maryland, the laws frown upon an investor approaching homeowners in pre-forclosure.
Do you advise just investing in another state, since there one would have to use an agent for the deal? Thanks.
so what happens if a home owner aproaches an investor???
i have found it its easier to complete short sale deals with owner occupied homes. and the ones that were investments are harder to close … have you guys had the same experiences? or am i just not working these ones right? im near seattle, wa and wondering if our market isn’t bad enough :deal
I have done short sales all over United States and Deficiency sales all over Canada and instructed dozens of investors along the way all over north America. :beer
There are two reasons why a bank wont reduce there purchase short sale amount:
1.You the buyer have not built a good enough case with the lender and/or BPO to justify the reduction you are asking.
*In all cases you need to show the bank that the property is worthless for them to keep it, and its in there best interest to sell it to you for what you are offering.
2.The lender/Mortgagee and/or Loan servisor is not in a position to sell the property to you for what you are offering.
I had a short sale one time that would not reduce enough :deal, the note was $420k they reduced to $385k But I was asking for $125k (I know its sounds low but the mortgage on it was super inflated). The BPO even came in at $145k but they would not reduce. Two weeks went by they sent me an email if I was still interested at $380k, I replied only at $145k, the bank declined, 3 days later the note was sold to WaMu for $380k…. so there are a lot of internal factors that an investor on the out side just cant see :bobble.
I have never been under the impression that the bank even knows who is buying the property :anon and if they do, then why did you tell them :flush. Negotiate the short sale as if you are just the person facilitating the short sale and then close in what-ever/who-ever’s name. :cool
:bangheadNow getting a mortgage for an investor :banghead vs an Owner occupied :rolleyes, Now that is a different story. :banghead
Gosh I thought I would never disagree with anyone who said never use an agent or the MLS… But in a SS situation understanding how to manipulate the MLS is a great resource…
Everyone of my SS go onto the MLS and I negotiate each one of the SS… At a much better rate then 0 :125 or 1:20…
The key to the MLS in a down market is a SS can set the tone for value…
Everyone should agree that a buyer sets the value of what a property is worth right? And in a market where there are not enough sold comps to determine value and also where active listings are selling for less then sold comps a seller can easily manipulate the perceived lender value of a property using the MLS…
Especially when the buyer set true value. If John Doe is viewing similar listings one is 20k less than the other, which one hits pended status first? The lower priced listing.
Using that listing you can now justify on a different property which is in the same area, size, year built etc a lower BPO. You can spiral down the market much like increasing value in a highly appreciating market.
Most lenders rely on agents to do their BPO and most agents will look at the MLS to determine value. They typically do not dig deep enough.
BTW a Seller doesn’t have to be the “owner” according to MLS rules it is the seller who must authorize the insertion of a property into the MLS. The verbiage is very clear. It doesn’t say Owner. Reason being is because once you have the right to purchase you obtain equitable interest and therefore have the right to sell.
TMI