CALLING THE BLUFF ON LOSS MIT. OFFICER
I am in the midst of a deal here which looked good, but I am having a tough time having the second mortgage play ball with me. Here is the scenario:
First is @ 195,000
Second @ 48,000
Property value: $235,000
Sheriff sale in a month and a week.
Looks like a slam dunk. Right?
I offer the second 10% of what is owed (I always start REALLY low). The loss mit officer calls me and says, "That's way off...we are prepared to go the sheriff's sale to protect our investment." Now I am taking this as a rebuttal published in the LOSS MITIGATION manual. I reminded him that the sale is nearby and that time is of the essence. He said their bpo came at right at the amount owed on the property. I asked him if the person doing the BPO got a chance to look at the inside. He said "NO" After that it seemed he was willing to take another offer
The last time a loss mitigation officer said that to me..they never came to bid on it and they lost their stake when the redemption expired.
If anybody has ever heard the same thing...please tell me, and the others what your experience has been.
Don't you have a 6 month redemption period in your state? If you do then you seem to have some time to play the game.
Good Luck,
Tom
I don't think you should start at 10%. I think you should start at 40%. At least they will think you are serious.
Hi dolph922,
Another thought is to suggest to the L/M rep that he should order an interior BPO and tell them that you are the contact person and can get them in the house. Take comps with you to justify why the BPO should be considerably lower.
Once the BPO comes in, present a new offer to them based on the lower amount. Depending on their position, the bank is still going to have the hassell, holding, and selling fees. Use these amounts to your advantage.
In a lot of situations, I agree with what Joel said. However in this specific situation, the 2nd would have to be almost eliminated or at 10-20%. It can take a long while in some cases to sell a property in the mid $200's. If you only get a little cushion on your short sale, it could be gobbled up in no time with holding fees, commissions etc.
Best of Success!
BAMZ
Joel,
It is somewhat offensive to offer someone only 10%, but every third offer accepts...in fact last month I bot a $120,000 second mortgage for $11,500!!!! I will glady lose a couple of fish to land the big whale!!!
I have done over 35 short sales in the last two years and have a 80% success rate. Remember its not what you propose...its how you propose it.
Thanks for all your responses, but has anyone ran into this same experience or line??? IF SO, what was the outcome....how did you handle it?? Is it a dead end street or not???
Seems like if you have done sooo many shorts like you told Joel with a 80% success rate than I am surprised that you haven't come across this before. Why can't you just keep submitting the same offers or maybe tweaking them. Like I said before I believe you have time due to the redemption period. Unless you don't have a redemptions period. Or just give up and move on to the next. I do like the idea of having another BPO done.
Tom
Tom,
I am surely not bragging....I just am looking for a possible rebuttal that someone may have...or if you guys think that the Loss MIt Officer is bluffing? Is this just a natural thing they say? "WE ARE PREPARED TO BUY THE PROPERTY AT THE SALE??" It just sounds scripted, but maybe I am in denial.
Thanks for replying Tom
Hard to say Dolph. They do have the option of purchasing the first. But they do seem to be willing to hear another offer. I would sit back for awhile and see what happens at sale. After that try your offer again. Never know when it comes to banks.
Good Luck,
Tom
The truth is that alot of lenders even in 2nd position will bid at auction to protect their interest. Sometimes they will even buy the 1st out and foreclose themselves. Why do they do this? Its about them mitigating their damages. If they say no, you say next. Just the way it is. Leave them your offer. As the sale gets closer, the lender may get more interested in working with you. Then again, maybe they wont.