Shorting the 2nd

Foreclosures, Short Sales, Tax Foreclosures
1

I just completed and sold my first shortsale last week. It only had one loan and I am now working with a woman with 2 loans:

1st: 119,000
2nd: 40,000

Few questions that I have are:

Is there a different approach to getting the 2nd loan discounted?

For instance should I send over a ss package w/ comps, repairs,etc. just like the first?

And since there are 2 loans, are their also 2 closings?

Thanks as always,

gregg tucson, az

2

Is she behind on both?

If she is, contact the first, they’ll tell the second what they’re going to get.

There’s only one closing.

There’s not really enough information.

3

Send them all of the info as you did the 1st. It only costs you a phone call. Send them info to let them know that they are the 2nd and will lose out completely. Though, Ocwen HATED me telling them this or at least their rep Dan Begly did.

What does the second want? I’ve had luck just asking that question. You do not and should not accept that number unless it is what you had hoped for.

Have you spoken with them and explained that the 1st is foreclosing?

As JDS says try to offer just what the first will allow. If your deal can accommodate a higher number than what the 1st will allow, do it. Just keep it low so the rest of us can still get 1k 2nds. A rep at HSBC has offered to conceal any payments over the “required amount” of the 1st. She told me “if we did that all the time, we would be out of business.”

4

I appreciate the responses

JDS, she is behind on both- 4 months behind on first, 2 months behind on 2nd.

I suppose a little more information would help…

Home would sell for … 148k after rehab

My best offer on home will be… 98k

Sell to rehabber at about… 113k (make my 15k)

Leaving rehabber room for 4 months
repairs and holding costs 16k

And rehabbers profit would be about 20k
after selling for 148 k

Does that seem about right to you?

Another unrelated question that I have is how do I present my offer to 1st and 2nd position? For instance, if I were to submit a 1k offer on the 2nd how is this done? Is this conveyed anywhere on the purchase contract? What would I do in the case of a first and second?

Let me know wht you guys think. Thank you.

Gregg , Tucson

5

Call the first, offer 80, 79 to them, 1 to second

Wait for the laughter to die down

Offer 90, 85 to first, 5 to second

They might take it

Offer 98, 90 to first, 8 to second

First might tell you they want second to take less, but in any case, tell them this is your final offer.

If they say no, find the next one.

The total price goes on the purchase contract, the individual amounts go on the proposal to each bank and the HUD-1

You talk to the banks, the banks talk to each other, eventually everyone agrees, or not.

Someday, I’ll get a check in the mail for all this info, then I’ll go for a game of poker.

I digress

6

Did I miss something or did Greg see the property before making those rehab estimates and profits?I dont understand how you can calculate the #s you did with the information given? Please educate me.

7

He said his best offer would be 98K

You never start with your best offer.

They’re his numbers, I hope he’s done his due diligence

8

Thanks fellas,

Yes, I have seen the property. I am going to bid in a similar manner as JDS advised. Ill let you know how it goes.

Thanks again. gregg