Seeking Short Sales Input
I am new to the forum. I posted this yesterday in the pre-forclosure/forclosure forum. 
I guess it should have been posted here.
I am an absolute total diaper stinking, no funds having, starving newbie. I have enough knowledge to maybe get in trouble. With that said, I will ask questions. I am not afraid and willing to try even if I fail.
I came across a person who will be behind 7 months this coming month in their note. They want to walk away from the property. I advised them not to do that. I advised them I would see what I could do to help them. He is perfectly willing to allow me to represent him and has signed authorization of such. I found someone willing to by the home all cash for the remaining loan balance or whatever the payoff amount is. I have ordered the actual payoff. In the meantime, after reading you and others, I thought I would try and see if the lender would be willing to do a short sale. They seem to be and advised me of what would be needed, which is basically the same info I have learned from doing my research and reading. I am in the process of gathering all the necessary components. Here is the breakdown on the property. I have also gotten a realtor who will list the property.
FMV
$125,000
Existing First loan* $111,600
Original Loan $112,500
Questionable 2nd deed* $24,000
Outstanding taxes
$2000
Repairs (mainly sewage and
tree roots advancing into foundation) $6000
Realtor 4% of sale
* I found this when I went to the recorder of deeds. This was a seller carry back from the original purchase. It was supposed to have been satisfied under arrangement when the owner did a refinance with present lender two years ago. I am presently researching to verify.
My question is this is it possible for me to build a fee into the sale price when we write up the contact or am I being to ambitious? Naturally the seller has no funds to give me. Any suggestions, pointers or comments would be appreciated from anyone.
My Thoughts:
Assuming it is the 1st that is foreclosing:
The 1st mortgage may reduce a bit depending on the work needed and the lack of the owner to pay. You will need to verify the owners inability to pay.
The 2nd should be offered about 10% for starters to settle.
Taxes will move to the top of the list regardless. They can be negotiated sometimes.
Double check your repair costs and make sure you are not missing anything.
Lastly....why do you need a Realtor???? That will be a large chunk of your profits.
Rule of thumb: FMV x 70% - repairs = offer.
Thanks for your response.
It is the first that's foreclosing.
<Lastly....why do you need a Realtor???? That will be a large chunk of your profits.>
Believe me I was thinking Just like you.
In speeking with the short sale rep for the lender he said they wanted a realtor listing. I agree with you. However, I did ask him twice to make sure. I have the seller under control and have all his financial info ie. awards letter, he is on SSI and drawing auto workers retirement pension, bank statements and tax returns. Also I have the hardship letter.
After thinking about you asking that question, the rep did say I would have to include the cost of an agent whether that was me or someone else. That gets to really what I was wanting to find out, can I be an agent? Was he giving me a hint so to speak?