I have a potential deal but am having trouble convincing the owners to buy into it.
The owners have owned the home for 17years, and purchased it for 75,000. They did a refi a year ago and pulled equity out with the new borrowed amt at about 114K. They got caught in the predatary issues and found their payment increasing 100% after 1 year.
They are delinquent with WF in the amount of 128K, and the home will be auctioned in March. Recent comps are at 100k
I spoke with them about the short sale process and how this would keep them out of foreclosure, etc. They said that they attempted this with the bank and they declined. I did not have the ability to convey the benefits of conveying the deed and allowing me to negotiate a short sale vs being foreclosed on.
As a followon to my posting above, based on the fact that the home will need carpet/paint, roof replace and possibly HVAC repair, will the lender get this property down to under 70K?
My initial response is to find the next deal. If you have to convince someone who is facing foreclosure that you can help them, they aren’t a very good client. You need a seller who will do what you say…the short sale process is difficult enough.
Now for you, you didn’t miss anything with them. From what you wrote it sound like they have a preconcieved notion that the short sale won’t work because the bank already told them no. You could let them know that yes the bank told you know because they won’t let homeowners do short sales, someone else needs to do it because the homeowners can’t do it themselves.
If you want to try and salvage it, find out what documents they gave the bank, where where they in the process. Explain to them that there are x number of steps in the short sale process and if they screw any of the steps up the bank will say no, but you are an expert at getting them to say yes.
See if they will let you talk to the bank and find out why they said no. Tell the homeowners, what do you have to lose by me just talking to the bank.
Hope that helps. Like I said, I would probably move on, short sales are everywhere in this market.
Like James said the bank said no because the owners can’t do a short sale. You also probably will need an executed sales contract. Get the paperwork from the bank that they require and then go over it with the owners. If you still can’t convince then cut them loose. Time is your enemy on a short sale and if they keep on with what they’re doing you’ll run out and then nobody wins.