Landlord Calls With Payment Problems
Claims to have the follwoing:
> properties that she is losing money on monthly with tenant problems. she is paying out of pocket to keep loans current. she is interested in a short sale as she has moved 3 hrs away.
property # 1: 1st mort $54K, 2nd mort $32K and property is worth as is value $92K
properties # 2 & 3: she entered into a sandwich lease option with a business partner. business partner carries loan and cannot afford to continue this agreement.
Question: Can a short sale be performed for one late payment?
Question: The reason she is paying out of pocket is to keep her credit strong. How would a ss affect her credit.
I am sure she is going to try everything possible to figure this out so if I could help her on the ss property this would be a good one to get. It is in great shape.
Easy, you catch the payments up and turn it into a rental, until you can sell it.
Big question is though, who determined market value at $92k? Check this number and also check how profitability on this home would be even with a well paying tenant. Also make sure she starts eviction proceedings on the current tenant so you can inherit the property with no problems!
Chase
Quote:
On 2006-10-04 05:40, daryl1234 wrote:
Claims to have the follwoing:
> properties that she is losing money on monthly with tenant problems. she is paying out of pocket to keep loans current. she is interested in a short sale as she has moved 3 hrs away.
property # 1: 1st mort $54K, 2nd mort $32K and property is worth as is value $92K
properties # 2 & 3: she entered into a sandwich lease option with a business partner. business partner carries loan and cannot afford to continue this agreement.
Question: Can a short sale be performed for one late payment?
Question: The reason she is paying out of pocket is to keep her credit strong. How would a ss affect her credit.
I am sure she is going to try everything possible to figure this out so if I could help her on the ss property this would be a good one to get. It is in great shape.
no profitability on rental situation after catching up payments. 92K is right own the comps of the neighborhood.
this is a definite ss. should i recommend being behind a payment, evict the tennant and roll with a ss? keep in mind the only hardship would be she has no more $ to fund the property. her credit is strong otherwise.
What does it look like as a rental? Is it not cash flowing because of the tenent or bad managment or because the payments are too high? If with the right managment in place the place will cash flow than buy it Sub-to. Her credit stays good because you are making the payment and you get the cashflow. Not sure about the other two with the sandwhich lease would have to see details but you might be able to make a deal there as well.
J
no cash flow period. after both loans payments are $749 and rental for this area is $800/month. even with a good tennant or management co. i do not see this as a subject to or lease option.
not in a progressive area.
seems like a ss to negotiate some equity.
does she have a case for her lender to approve a ss if we proceed?
progressive vs money making opportunity?
progressive, upscale, high appreciation...no
nice home for medium household income in a development...yes
not a war zone as you have portrayed.
house is 13 yrs old, new htg/air, recent paint, only needs carpet and few cosmetics
thanks for your replies. i will get rolling with the ss process and tell her what needs to take place.
by the time she is late, we negotiate then she is two payments late; how will this effect her credit? I know there will not be a foreclosure even listed but will it show late pays and loan settled for less in her credit report?
As far as a SS: The 1st mortgagee will sit back and wait for its money... you may have some wriggle room with the 2nd, and the 3rd.
Nail down the as-is FMV paying particular attention to the local market condition and forecast indicators. Nail down the costs for repairs.
Devise a compelling proposal, present same to the authorized/empowered panel.
Can I short sell or discount the second loan 108K (50K Discounted offer) and bring the 1st loan current.
The second would have to be willing to allow you to participate in a subject to transaction. Either ask them, point blank, or devise and submit the preliminary HUD1 indicating the sub2 purchase
Or, since I infer you have the $80K cash to do this deal, you can simply offer to purchase the second at the stated discount.
On 2nd mortgages, always start as low as possible. With this scenario, i would start with 10%.
I should mention, the home is listed currently. Has been with two different brokers now...contract is not cancellable...
Also, what is the hit on my credit after this is said and done? Or is that negotiable too?
And lastly, my 1st TD is with Homecomings ($488K plus prepay, 6.25%/ 6 months). The 2nd is with HSBC..no prepay, 122K).
Thanks again!
Sam
Here is how you work the short sell.
1) contact your first and second lien holder and ask for their short sell packages.
2) determine with the help of your realtor what is the price at which the house would sell quickly, as-is, no contingincies, and maybe even get a cash offer. State in the listing that it is AS-IS, pre-foreclosure.
3) complete the short sell package and send back to the lenders.
4) when someone submits a contract, have them sign a short sell addemdeum to the purchase and sales contract that states that you are working a SS with the lender(s) and that the sell is contingent on the SS approval. You need a buyer with no contingences, cash would be great.
5) when the lender wants to schedule a BPO, have your realtor call the appraiser/realtor in advance and fax them comps to support your AS-IS, no contingency price. Have the realtor meet the BPO person during the BPO and have the realtor work them to get to the price that you need.
6) your realtor and the listing realtor has to realize that there will probably be only a 4% total comission allowed by the lender if the lender allows a SS. You may want to add "realtor commissions may be dictated by the short sell lender"
7) the success on your short sell is dependant on the 2nd lender. You need to get him down to whatever you need for your fire sell price. The first probably will not short at all.
2) also, change the asking price to your fire sell price.
3) also, include in the package a CMA performed by your realtor to support your asking price.
6)also, You may want to add to your SS addendeum, "realtor commissions may be dictated by the short sell lender"
7) The first probably will not short at all - but there is no harm in trying. But normally, the first will not short unless the second is wiped to almost nothing - like 1k.
I did not realize that you were current on your mortgages. You can still try a SS, but it will be very difficult unless you are behind in your payments.
Panic, doing a forbearance plan. It was my understanding that most lenders will want the homeowner to rightfully employed.
they will require most recent pay stubs. In order to incorporate a forbearance plan, the lender needs to know whether or not the borrower can afford to make the payments. Basically was the problem temporary or will it still exist after the loan is reinstated.
Just wondering. Not trying to slander anyone. My last posts have been shredded.
i would let them go without batting an eye, like i said it is in ALL my listing agreements but this realtor does not have it.
also we do not know if he told he realtor the situation yet, i was jut saying to assume he could just get out IMO was wrong.
I agree i would rather walk away as friends before we became enemies. to me he needs to talk to his realtor and explain what is up(we are barely ever told the whole story, we dont find out until title search time when there are problems)
i actually have a customer of mine who i have listed called me and told me he can not afford his house anymore and really needs to sell fast. he has about 20k in equity in it, now i did not know this 1 month ago when i listed it but he decided he needed to get honest with me. he was thinking of either renting it or what ever he could do. well we are verbally agreed for me to take it sub2. to help him out. if he would of never said anything i would of never known and could not of helped or would not of known what kind of options to offer him.
talk to your realtor tell him you can not afford the house and are going to go into foreclosure if you do not drastically reduce the price for a sale and see if they will let you out. if she says no then talk to her broker who that is actually who you have the property listed with anyways and the realtor just does the work
Can she do that for me? List it as a seller finance? I either have to work around her entirely, renting the property until my listing is up...or work with her, and make her work with me.
ok in your listing it probably says something along the lines of..if you take th eproperty temporarily of the market the listing automatically extends for that many days. so to not give her access is silly.
here is what i would do, i would tell her we need a face to face and i would spill the beans and tell her if we do not get it sold you will go into foreclsoure and lose the house and she will make nothing and ask her if she can work with you on this to move this house as of yesterday. you have not tried it so do not go in with a closed mind until you do.
now on to the fact that she will go to court over her money well if she earns her paycheck she shoudl go after it. how would you feel if on friday your boss did not pay you? you are thinking of ways around her commission, try working to find a solution together instead of another person against you.
you can sell owner financing with a realtor jsut explain to her you want to honor the listing just need to work together to make it happen and i am sure it will workout.
Anyone here feeling a bit like a philanthropist, and want to buy my house from me? All I care about is getting what I owe for it at this point. Everything else seems to be a PITA.
By the way...I added my property...check it out in my profile.
Thanks guys.
Sam
Usually there is a cancel fee and the agent would only be entitled to that. Read your contract
Thanks for responding SS Pro. The new appraisal should not be anywhere near the 160K BPO. We know our market well and avg. sales in the neighborhood have only been 106K.
Can you tell me what % of the loan 1st and 2nd mortgages are typically insured for? and Why the Insurer has the final say on the SS?