Is This Even A SS?
If this question seems elementary please forgive me. But I'm just getting into REI and this would be my first deal. I have someone who is 5 mths behind on her mtg. FMV is 165k, she owes 140k and wants to receive the equity .If I am successful with the short sale, will the homeowner know how much the lender has agreed on as I see where that would be potentially problematic.
Any advice on how I should proceed or if I should even proceed.
Thank you in advance.
The homeowner will know what she is selling the property for because you sign a purchase agreement.
If you can convince the seller to sell for what she owes you have some possibilities.
If fair market value is $165 and she wants $140+$25=$165k then how do you make money??
In answer to your question, it's only a short sale if the mortgagee agrees to accept less than they are owed on the mortgage.
Shorts are tough when there is a perception of equity...
The question you must ask yourself and answer is:
Would the mortgagee be made whole by pursuing the foreclosure.. and what can I do to influence their decision to accept my Short Sale Proposal
[addsig]
Five months behind and wants the equity? I would let them know that the law will be knocking on the door soon and (s)he will be lucky if thieves dont steel her belongings.
you are working for her if you pursue a short sale and are thinking about giving her equity - there is almost NO chance of the mortg co allowing her to even get u-haul money if they are taking a loss
tell he she is being unreasonable and let her come around, or move on.
Many thanks to all for responding. I'll keep negotiating with the homeowner and hopefully she'll come around real soon.
You must make it clear that the lender will not allow the seller to receive any funds at closing. Also, as a side note in your negotiation emphasize the fact that you are helping him/her out of foreclosure and that is worth more than the equity that they will not even receive if the property does indeed foreclose. Best Wishes!
Thanks Alegrier.
This might be a good subject to deal. Selling the house through a realtor is going to eat that equity up and if the house goes into foreclosure she gets nothing. About a 1/4 is owed in backpayments. I'd maybe offer her something for her equity, but not much.