{"id":306,"date":"2012-12-05T14:18:25","date_gmt":"2012-12-05T18:18:25","guid":{"rendered":"http:\/\/www.realestatejunkie.com\/blog\/?p=306"},"modified":"2012-12-05T14:20:12","modified_gmt":"2012-12-05T18:20:12","slug":"5-tips-to-negotiating-on-short-sales","status":"publish","type":"post","link":"https:\/\/www.realestatejunkie.com\/blog\/5-tips-to-negotiating-on-short-sales\/","title":{"rendered":"5 TIPS TO NEGOTIATING ON SHORT SALES"},"content":{"rendered":"

TIPS WHEN DEALING WITH SHORT SALE SELLERS \u2013 How do you know it is a short sale deal?<\/h2>\n
    \n
  1. When they are willing to sell the house for what they owe.<\/li>\n
  2. When the house is upside down and you can\u2019t pay as much as they owe on it.<\/li>\n
  3. When they are too far behind on their payments that you can\u2019t make it up and keep it as a rental or subject to deal.<\/li>\n
  4. When the monthly payment amount is more than you can get for rent.<\/li>\n
  5. When the house is trashed and the cost to rehab it is too high for the return investment.<\/li>\n<\/ol>\n

     <\/p>\n

    <\/p>\n

    5 TIPS TO NEGOTIATE ON SHORT SALES WITH THE BANK<\/strong><\/p>\n

      \n
    1. \u00a0Know how much is owed for Homeowners Association Dues \u2013 banks only like to pay up to 12 months on HOA LIENS not balances<\/li>\n
    2. Know if the home will have to be sold Cash or can go FHA \u2013 Repairs are important if the house can only be sold as a cash deal then you are able to use this during your negotiations.<\/li>\n
    3. If your offer is denied, ask them where the offer has to be?\u00a0 If that is too high, split the difference in the middle and see if they think they can get this approved based on that price.<\/li>\n
    4. Knowing what type of loan you are dealing with ie. Fannie Mae (90-92%) , Freddie Mac (90-92%) doesn\u2019t like investor buyers, FHA (88%), PMI (may require a promissory note) on the property \u2013 being knowledgeable as to the percentage that they are willing to take as a net on the deal and\/or purchase price along with if they will even consider an investor as a buyer in a corporation name.<\/li>\n
    5. If there are repairs needed on the home \u2013 you will need to have a repair bid estimate to send in to the negotiator to dispute the repairs that the BPO Agent\/Appraiser did not include on their value.<\/li>\n<\/ol>\n

       <\/p>\n

       <\/p>\n

      New Laws for Freddie Mac Short Sales \u2013 by Kimberlee Frank<\/p>\n

       <\/p>\n

      I have been doing short sales for a long time and I have watched the industry change regarding Trusts, Options and Arm’s Length Affidavits.\u00a0 Recently, I read that effective January 1, 2012 Freddie Mac is not allowing flipping on short sales and is looking to hold all parties liable if they are aware of reselling the property for a higher price.\u00a0 The funniest thing is they call it “flopping” which I believe was a typo from a secretary that just carried on and on throughout their paperwork.\u00a0 In addition, they don’t specify the time line in which you can resell the property for property.\u00a0 The purpose of the Arm’s Length Affidavit has always been that the seller is not getting the discount for their benefit and staying in the house.\u00a0 “Make sure you read your Arm’s Length Affidavits and check your sellers loans at www.freddiemac.com\/mymortgage<\/a> to see if it is a Freddie Mac Loan.<\/p>\n

       <\/p>\n

      Bank of America approximately 2 years ago had placed a requirement on the new buyer that they were to hold the property for 30 days before being able to sell the property again.\u00a0 GMAC and Wells Fargo has placed a requirement on the new buyer to hold the property for 90 days before reselling the property. \u00a0 Remember, it is the investor underneath the mortgage companies guidelines not always the mortgage company.\u00a0 However, I have found that the mortgage companies are starting to adapt these requirements in their own company policies.<\/p>\n

       <\/p>\n

      When BOA included the 30 day hold provision in a payoff letter, I argued the fact that they are trying to put a deed restriction on the property.\u00a0 However, they never put that wording in the deed so how in the world would anyone ie.\u00a0 the new second buyer know that there was a requirement of the first buyer to hold the property for a time period.\u00a0 They wouldn’t but the first buyer does know and has signed an Arm’s Length Affidavit stating the terms for the purchase.<\/p>\n

       <\/p>\n

      I have always taken the stand that the Banks\/Mortgage companies are the ones who send out their bpo agents\/appraisers to advise the companies the value of the properties.\u00a0 So even as an investor if you made an offer at $100,000 because that is your MAO “Maximum Allowable Offer”, they had determined based on market value provided by their eyes and ears (bpo agents\/appraisers) how much they would be willing to sell the property for.<\/p>\n

      Therefore, if an investor got a good deal and all your paperwork submitted to the short sale lender says you intend to resell the property for profit then you are “ok”.\u00a0 Until, these Arm’s Length Affidavits are adding additional wording.<\/p>\n

       <\/p>\n

      NOW, the Arm’s Length Affidavit forms that they are having everyone sign ie:\u00a0 Seller, Buyer, and Realtors all state the following on Freddie Mac deals even before January 1, 2012:<\/p>\n

       <\/p>\n

      1.\u00a0 Each signatory to this Affidavit expressly acknowledges that the Lender is relying upon the representations made herein as consideration for discounting the payoff on the Loan(s) which is secured by a deed of trust or mortgage encumbering the property.<\/p>\n

       <\/p>\n

      2.\u00a0 Each signatory to this Affidavit expressly acknowledges that any misrepresentation made by him or her may subject him or her to civil liability.<\/p>\n

       <\/p>\n

      I\/We declare under penalty of perjury under the laws of the State of whatever that all statements made in this Affidavit are true and correct.<\/p>\n

       <\/p>\n

      Additionally, I\/we fully understand that it is a federal crime punishable by fine or imprisonment, or both, to knowingly and willfully make any false statements concerning any of the above facts as applicable under the provisions of Title 18, United States Code, Section 1001, et seq.<\/p>\n

       <\/p>\n

      I have also seen certain wording in the Arm’s Length Affidavits that you are NOT aware of another contract whether it is verbal or written to sell the property for a higher price.<\/p>\n

       <\/p>\n

      I am just saying be careful when you are acting as an Investor and a Realtor as the big bad Banks are looking to blame someone for their mistakes.\u00a0 Don’t stop buying real estate, learn the changes that the Banks\/Mortgage Companies “INVESTORS – ie Freddie Mac” are starting to require so you don’t get to the Title Company and sign something that you didn’t understand that can hurt you later.\u00a0 You just hold the property for the time frame necessary to make a profit!<\/p>\n

       <\/p>\n

      I will be writing you a lot during this December and will be converting a lot of my email and video contact with you to different programs ie. infusionsoft and talkfusion so … make sure you look for me and opt in.\u00a0 My goal to you is to send you out at least 2 great tips a week!\u00a0 I know this is a lot of tips, however, I know you all need to make a change in 2012 so I am going to help you get there.\u00a0 I have so much planned for you it is going to blow your socks off.<\/p>\n

       <\/p>\n

       <\/p>\n

      So … stay tuned!<\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

       <\/p>\n

      God Bless,<\/p>\n

      Kimberlee Frank<\/p>\n

      www.ForeclosuresGoneWild.com<\/a><\/p>\n

      www.SellFastRealty.com<\/a><\/p>\n

      www.RealEstateJunkie.com<\/a><\/p>\n

       <\/p>\n","protected":false},"excerpt":{"rendered":"

      TIPS WHEN DEALING WITH SHORT SALE SELLERS \u2013 How do you know it is a short sale deal? When they are willing to sell the house for what they owe. When the house is upside down and you can\u2019t pay as much as they owe on it. When they are too far behind on their […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-306","post","type-post","status-publish","format-standard","hentry","category-local-guru"],"_links":{"self":[{"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/posts\/306","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/comments?post=306"}],"version-history":[{"count":0,"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/posts\/306\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/media?parent=306"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/categories?post=306"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.realestatejunkie.com\/blog\/wp-json\/wp\/v2\/tags?post=306"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}