Short Sell help

I’m meeting with my first motivated seller tomorrow. She is currently behide on taxes and has a loan for 260g with Encore Credit Corp at 8.8 interest rate. She told me that her rate is so high due to her bad credit. She has also refinanced her home every year for the past 5 years for some odd reason. What are the possibilities for me doing a short sale on her loan? Also at the meeting tomorrow what forums should i get her to signed to secure my opportunity to buy her home and to proceed with the short sale?

Get her to sign a quite claim deed if there is equity . And then get her to sign a statement saying she will be gone with ALL her belongings in 5 days.

So should I get her to sign a quit claim deed over a warranty deed? I just want to disable people from stealing this opportunity form me. Also, if for some reason the shortsale is unsuccessful, am i suck with the property?

I read that i should also get her to sign a Power of Attorney, is this true? Once these documents are signed, should i take them and get them notarized or should she? Should there be any money in this transaction other then the notarization fees? Please explain to me step by step… Thank you in advance!

If you want to do a SS, why would you take possession? You can’t SS if you already own the property.

You say she has 260K against the house, what is the house worth realistically?

Then you can decide if you want to take the property sub2 or work a SS.

If you are worried about control, just have her sign an option to buy the property in the next 30 days don’t quit claim.

Once you take the title to the property, you inherit all the leans against it…I don’t think you want a 260K mortgage that is foreclosing taking “your” property.

I may be entirely wrong, but that is how I see it.


There is currently no equity in the house. The house is worth 260g. Houses in the current area takes a year or more to sell if they even sell right now so the house might even be worth lesser. Under this scenario, i believe it’s best to SS the house.

So if she quit claims on the house, i would automatically inherit all her liens?? I thought a quit claim deed would just disable her from having rights to assign someone else the opportunity to buy her house? Plus, doesn’t it take 2 to 3 months to go through an actual short sale? So wouldn’t i want an option to buy that is longer than 1 month?

Also are u allowed to make up an option to buy a house without a set purchase price? I ask because having an option to purchase would give u control, but with if the short sale doesn’t go through, how would u know what your option to purchase price will be? Wouldn’t the seller be aganist signing an option to purchase without a pre-set price?

you just get the paperwork. you dont necessarily record the deed until after the short sale but even if you do it before, it doesnt matter. the loan is in the sellers name and thats all the bank sees.

plus, when you get the deed, you dont take ownership in your name. you do it in the name of a trust with the sellers name in the title. that way, it still looks like the seller owns the house even though you control it.


You can either do a short sale or a sub 2. Do NOT do a quit claim deed unless you do a sub 2. Do a warrantee deed (to trustee if you want to put it in a trust)… if SS do not record the deed…just use it as insurance that the house is yours in case you get a good outcome with the short sale or option.

If you decide on a short sale…Have her sign 2 purchase and sale agreements, an agreement saying that you cannot guarantee that she can stop her from going into foreclosure, the warrantee deed, a limited power of attorney, and borrowers authorizaiton.

You will also need to get her loan information. If she is not behind in her payments you will not have a rep to call about the short sale yet.

If you decide to do a sub 2…you would only do this if you can handle her monthly payments and rent or lease option her house for more than the payments…you would get everything from the above except for the agreement that you can stop her from foreclosure. Your exit strategies on this would either be owner financing with a down payment and an interest rate high enough to cover the monthly payments (wrap around mortgage). Or lease option the house to someone with a non refundable deposit that goes toward the price of the house (which would be higher than market price) then you lease it out for more. You can rent it out for more than the payments, but the rent would have to match current market rents.

Hope this helps.

Since i plan on doing a short sale, i will do the warrantee deed and get it notarize. I of course will not record the deed until the short sale is accomplished. What are the benefits of putting the warrantee deed into a trust? If i was to become the trustee, would it be easier for me to assign the deed if i wish to? BTW, what kind of paper work do i need to get inorder to form a trust?

As for the 2 purchase and sale agreements, what are they exactly? Can you please be more specific about them and what they will enable me to do? As for the agreement saying that i cannot guaantee that i can stop her from going into foreclosure, this is basically a discloure document i just need to make up and get her to sign it yes?

As for the limited power of attorney forms, which of the 3 should i get?

All help will be most appreciated… Thank you in advance!