Pursue With Short Sale? Yeah..or Nah?
Seller was telling me that she
doesn't think that her attorney has done everything he can as far as a short
sale goes b/c there wasn't an offer made from any buyers.
Here's the info:
3/2.5 Bth + Basement, 3000 sq ft, 1 car garage
4 mos. behind (still hasn't received the auction date)
Owes - $226k (without fees) total
<1st = $173k (w/o fees)
2nd = $53k (w/o fees)>
Comps - Hard to find any b/c of the basement not showing on the comps. It
can go anywhere from $183k - $370k.. we'll have to go look
Appraised (2) yrs ago - $225k
Suggestions pls.
on appraisal questions I have found it helpful to befriend a local appraiser and if you do so they will be quite chatty about valuation. Basements are not generally valued very high. But!.. they do add to the marketability of the property.
Sounds like you have the makings of a good short sale and I would ignore what her attorney has or hasn't done and do due dilligence for myself. Attorney's come in all brands. Generally my experience has been that people who can't pay their bills don't attract the most motivated attorney. After all, what's in it for him? he can't lien the property for his services..
Reflecting more on your post. I would be eager to pursue this if it were in my area and the property could be bought 70<% You might be able to wholesale a deal to another seller and never take possession. Make sure that any contract is assignable.
Good luck, I haven't done a short but have watched from the sidelines and this looks good to me. 1. large second They get nothing if the property is foreclosed by the first. THis should make them amenable to bargaining. The whole forclosure and resale process for the 1st will probably cost them 12-15K plus the holding costs 6% commision to agent to sell and legal fees, hassle etc. One might make an offer for 15+K to the 1st and see if the second would cash out for half (these foreclosed properties seldom sell for enough to satisfy the first let alone the second) depending on your current market, firesale is the word I am thinking of.
Good luck! sounds exciting! and the learning experience should be worth the time regardless of how it plays out.
15K+ less than the 173K
Hi Rosn,
I would work both the 1st and 2nd. You may get both of them to short it. If the 1st wont short, I would short the 2nd for 5-10 cents on the dollar. I have had a large 2nd like that short to me for $5000. That left a large sum of money to be made on the transaction.
Best of Success!
BAMZ
Stockpro99 & BAMZ,
Thank you so much for your suggestions. I spoke to the seller again and she mentioned that she spoke to her husband and her attorney again...and her conclusion is to basically try to sell her house FSBO. But if it doesn't work out..she'll give me call. So we'll see howit goes..if she calls me or not.
Again..thank you both for your inputs.
Get in touch with The Dynamic Duo. They do short sales all the time. Their phone number is 303-838-5532. They are good at helping with short sales.
Thanks a bunch Kaye.
When I run into another short sale...I'll be sure to keep them in mind.
Thank you!