First Short Sale

I also put an offer on a short sale last fall. The house had been listed over several months. It was priced at $79,900.00(it sold for $105,000.00 in the early 2000's) The bank was just about ready to foreclose on it when I put an offer in. This neighborhood had a couple REOs within the last year with similiar features. They both came in under $50,000.00. The street is busy but on the other hand the central location is great.
I put an offer in at $50,000.00. The bank was motivated and came back at $55,000.00. My realtor and I countered that at $51,500.00. The bank refused that. We upped the offer to $52,500.00 later on and the bank wouldn't even respond. That was as high as we were willing to go. The bank wanted $55,000.00 and nothing else. So be it. We went on.
The house has been foreclosed and any day it should be listed as an REO. I am keeping my eye on this one. It will probably show up in the $70,000's but who knows it may show up in the high $40,000's or low $50,000's. If the price is right I am willing to put in an offer. I have done my due diligence and will present this as an offer that can close quickly and with no continguences.
Good Luck.

wb

what type of funding are you using? And did you put a deposit with your offer?
I hear alot of short sale buyers doing $ 1.oo deposits.

g

I have a private lender who funds my projects. So far we have done 2 REO properties and and are currently working to close on a 3rd - also a REO. I fix them up and rent them quickly. I live in an area with a huge rental demand and good employment so getting tenants in before closing has not been an issue. Both of my propeties have been refinanced.
As to the short sale, I had put down $500.00 for ernest money. On the REO's, I put down $1,000.00. Good REO's with equity and minimal rehab go quick here, so my team (lender, realtor) are all set to go for quick action. The property we are setting to close on now has just a little work to be done. We did a cash offer, close quickly and no continguences.
wb

How much of the Cost are you able to get them to lend on?

Gil

On my first property, I was going to go traditional loan with 20% down. At the last moment my bank back out - within days of closing. I then got a call from that banks vice president. He also invests in real estate and said he would fund me. He did require 20% down and a higher rate. It all paid off because a year later the property appraised at $127,500.00 (we bought it for $68,500 - put in about $12,000.00 of work). We were able to refinace at 75% of appraised value.
Everbody got paid off and we had money in the bank.

My private lender was so impressed he funded my next project 100%. We were able to score on a great REO with little work and 50% off FMV. 6 months later we refinanced that property. We are now ready to go to close on a 3rd property. I am coming up with $3,000.00 and my lender is funding the rest. It is another REO. It was listed for $89,000.00 for over 2 months. I knew of this house, had driven by it but really didn't think that it would fall into my range of $50,000.00's.

Overnight the property dropped $31,000.00. My realtor and lender were all set to go. That day we put in an offer. We will give the seller the full price - cash deal, we are asking for 2 1/2% of selling price at closing and it is a noncontinguent offer. The house is in great shape. The bank countered the next day, we countered back and they accepted everything the 3rd day. We are now waiting to close. Tenants have been found, contracts have been signed and security deposit has been received.
wb

Way to go, WB! Rinse and repeat, rinse and repeat. Those deals make for nice paydays, though.

Advertising another website without DG permission is against website rules. If you have permission that's fine, Read website rule number 1! Kind of thread jumping also.

Michael Mangham
MD Home Acquisitions LLC