Countrywide SS
Hey Everyone! Need some help.
I posted about this deal about a month ago. The Mortgagor agreed to a short in August.. but I found that her bankrupcty was discharged but not closed by the Trustee. After working with the Trustee, they filed and received a Notice to Abandon interest in the property, allowing me to submit a SS. whew. Now to present.
FMV is a hard number to pinpoint these days in Michigan.. but I would put the homes FMV at $87k. The mortgage to Countrywide is for $95k. She is four months in arrears. My SS offer was for $66. I plan to buy and hold the property.
My current problem is that I cannot talk to anyone higher than whomever answers the line at the work out dept. After talking to about 30 different people, their process seems to be that they use a formula to determine if they will assign a negoitator. If your offer does not meet that criteria they do not elevate your offer, and they advise you to submit another offer. They will not provide any further information, other than advising you it is to low.
I do not think the deal is worth much more than I offered. Any suggestions with this one? Thanks!
IF Countrywide is taking appraisal and not a BPO, then this is fruitless to chase this any longer. I own the property behind the one I am trying to short. I have two appraisals that are less than 90 days old.. one for 110K and one for 115K. However, I have been unable to sell the house for 95K for the past 3 months. So.. as you know appraisals and Market Value are often two different numbers. Appraisals really are just there to support an exsisting agreed purchase amount.
I ended up submitting another offer, raising my offer by $500 on the HUD1. This $500 made all of the difference and the offer was referred over to a negotiator. We will see what their process is from here.
Hi webuyhousesmi,
I was wondering if you had an update on this Countrywide SS?
TAT
I have been so busy with this and another deal that I have not had much puter time.
Countrywide did order a full appraisal. However, the appraiser that was assigned was real cool. I walked her through the property and try to build rapport. At the end I handed her a few Comps for the neighborhood. The highlighted one that was the property right behind the SS. I explained that I had purchased that property 4 months ago. for 70K and that I thought that this was the best comp. She agreed with me and submitted the appraisal for 70K. I am so glad that I did not close on the other property yet.. .I have a pending 115K offer that is due to close this week on the other property.
So, we are set to close tomorrow on the property for 70K, 5K above what I originally offered. I increased my offer due to the demand for this neighborhood. I already have an offer coming in on this house AS-IS. So, it looks like it will all work out for my benfit. 5 months and alot of paper work. Wow Short Sales are a lot of work. [ Edited by webuyhousesmi on Date 12/11/2006 ]
Thanks for thr reply WeBuy. I am running into the same issue, just worse. My appraiser would not come down on the appraisal enough for it to be a deal and thats all that CW will accept net. It seems they do not factor in comissions, closing costs, cosmetic repairs and such. They are in the mindset of taking properties back. Anyone else have recent experience with CW?
From my one experience with CW, there seems to be two interactions that are very important. The first is when you submit the original package. They seem to have a formula for approving the prelim Hud. After the accept the initial proposal the numbers are all in the appraisers hand. If the appraiser comes in to high, I think that the deal is DOA. The appraiser that came out almost exclusively worked for CW, she told me. Most of her time was short sale appraisals, with the rest going to appraisal reviews for new mortgages. I was surprised that she was so willing to match my numbers. I did explain what I was trying to do helping the homeowner from foreclosure.... so maybe that benefited her numbers?
The latest bit of news is that I am getting ready to close.. and realized that the winter taxes are now due. CW delayed this thing so long that now the new taxes are due. I faxed them a new HUD with seller paying taxes (the PA states that taxes are not prorated). However, that got a big rejection. Their statement was we must get our agreed NET or it goes to auction Jan. 3Rd. So, I guess I will suck it up and pay the $1100. I could probably roll the dice and get it at auction for less, but I have been working with the seller for 5 months to keep her from foreclosure.. so I will net less so the bank can net more... the name of the game, I guess.
i had cw to discount a property from 130k to 82k just two weeks ago. So they are flexible. Get the bpo on yourside.
Quote:
On 2006-12-13 23:38, charlotteinvestor wrote:
i had cw to discount a property from 130k to 82k just two weeks ago. So they are flexible. Get the bpo on yourside.
Hi Charlotte,
What were the numbers on your deal? Did they come down from the BPO amount factoring in commissions, closing costs etc.?
Thanks
Charolette:
That is a little more than 10-15%!
Webuy, this is the short sale forum and that is what i was referring too. When i got countrywide to accept the discount.
The mortgage amount was $130k. The rep never let me know what the bpo was. I just know they agent accepted my bpo package for her with open arms.
Plus she did the weekend before the 4th of July, and she was ready to go out of town.
My package was convenient, plus i emailed her the same package, so she could cut and paste.
Just finished a short with cw and they accepted 75000 for a 139000 balance. So they will work with you. Hang in there.
Well I ran across my thread back from December.. and I thought that I would write the end of the story.
The first house that I rehabbed in that neighborhood (that I mentioned), was listed from 6/2/2006-12/22/2006. I had 5 buyers fall through due to financing. The 6th buyer was a charm.. and I closed 12/22/2006! on the heels of that ---
I ended up closing on the short with Countrywide on 12/28/2006, found a buyer for this property right away who loved the property and just wanted the kitchen updated. So, I rehabbed the kitchen for her and sold it by owner closing on 2/12/2007.
The SS was alot of work , but it ended up all working out well.
Locating/securing funding to acquire real estate has always been a commonly shared obstacle.
In view of the proposed tightening of lending criteria and the restrictions placed upon easy access liar loans... the hard money lender will likely get more business...
What is a Deficiency Note Contingency? How does it protect the seller?
When you are in your prelim conversations with the lender (prequalify the short sale candidate) this is something you should ask and find out long before you waste your time preparing and presenting an offer.
mortgagee criteria dictates 1) whether or not on that particular loan the lender will pursue a deficiency, or 2) the debt will be forgiven and a tax event has occured.
nobody replied to my post but since then I have learned this about PMI ...(excerpt) "If you default on your loan and the lender has to sell the house to recoup their lost money, the PMI coverage gives them a margin to cover such things as legal fees, closing costs, discounts to the new buyer, or Realtor commissions. The PMI policy is used, in other words, to cover the amount of equity that you would have otherwise paid into the property if you had made a full 20 percent down payment." Somehow I thought PMI covered the entire note and hence thought of PMI as a deal killer.
In any event it means that the offer I made to NovaStar was a darned good one - note amount of $101,000; PMI would cover 20%, my offer was $96k net to NovaStar - they would not budge off $108k, pay off was #133,500 - the house goes to auction tomorrow
First, I am NOT an experienced ss. But, PROFIT = REVENUE - COST regardless of where the money is going. I put all my deals through a cost/benefit analysis.
If the CMD is telling you 500k and you are paying 430k you are working at 86% margin. Subtract from 70k any costs you are likeky to incur, attorneys fees, rehab, eviction, cash to seller, marketing, commissions, financing costs, holding costs for 6 months, etc. After subtracting all these costs if you are satisfied with the profit then go ahead and pull the trigger. I guess it would depend on your market and how long you are going to sit on the property before it sells.
I live in Miami and our market is very slow now. We have plenty of buying opportunities but unfortunately it is difficult to move inventory. My last two purchases were investor bail outs.
For me this is NOT a good deal because there is not much profit to begin and any left will be quickly eroded by the holding costs. Again it largely depends on your specific market conditions. My best advice is, BE HONEST with yourself. Do not overestimate your ARV ad do not underestimate you costs.