Pre-foreclosure Investing — Putting Together the Short Sale Package
Posted by Usual in Lender Approved Short Sales, tags: Investing, Package, Preforeclosure, putting, Sale, Short, TogetherPre-foreclosure Investing — Putting Together the Short Sale Package
Free Online Articles Directory
Why Submit Articles?
Top Authors
Top Articles
FAQ
ABAnswers
0 && $.browser.msie ) {
var ie_version = parseInt($.browser.version);
if(ie_version Login
Register
Hello
My Home
Sign Out
Email
Password
Remember me?
Lost Password?
Home Page > Business > Pre-foreclosure Investing — Putting Together the Short Sale Package
Pre-foreclosure Investing — Putting Together the Short Sale Package
Posted: Feb 29, 2008 |Comments: 0
| Views: 609 |
]]>
When you work with the homeowner to put together short sale negotiations with the bank, you’ll also be assembling vital evidence in a short sale package. This package is very important in preforeclosure deals. It provides enough information to (hopefully) convince the bank to accept your short sale offer on the homeowner’s property.
Include everything you can in the short sale package that backs up your request for a short sale. Obviously, you’ll want to leave out extra evidence, (unless the bank specifically requests it), that may hurt your claim.
Common Items in a Short Sale Package:
Standard Purchase and Sales Agreement & Escrow Instruction
This is the standard sales contract between you and the homeowner, since you will actually be purchasing the property from the homeowner with the bank’s approval.
Authorization To Release Information
In order to get the bank to work with you, the homeowner need’s to sign this document stating that they authorize their lender, the bank, to share all vital information concerning their mortgage with you. If you don’t have this the bank won’t talk to you!
Letter Of Agreement and Addendum
This is the cover your butt document stating that you will work with the homeowner and the bank to stop the foreclosure, but you can’t guarantee that the bank will agree to stop the foreclosure during short sale negotiations with you.
Warranty Deed To Trustee
You’ll need to get a notary to authenticate this document. It basically shows who owns the property you are attempting to purchase.
Agreement and Declaration Of Trust
In order to keep your own name off of public records you’ll use this document to declare a land trust on the property, which you’ll have rights too.
Letter That Trustee is Making Payments:
This letter is used when you have an agreement with the homeowner that indicates you’ll be taking the property “subject to” and notifies the lender that payments will be coming from a trustee.
Escrow Letter
You’ll use this letter to tell the bank to apply funds in an escrow account to the loan balance when the loan is paid in full and the short sale deal is complete. Be aware there is no guarantee the bank will comply with the instructions for your real estate investment. They may send the escrow proceeds to the original borrower, which is the homeowner. So, you’ll need to make arrangements with the homeowner just in case this happens.
Special Power of Attorney
You’ll get this signed by the homeowner in front of a notary. It applies only to the property and lets you make decisions concerning the property if something happens to it before the short sale deal closes.
Residential Real Estate Disclosure
This is basically to protect everyone involved. You’ll sign it as the purchaser. It discloses any defects in the property and prevents anyone from claiming after the deal is completed that they weren’t aware of certain defects in the property.
Hardship Letter
This is a very important letter in pre-foreclosure investing. The hardship letter allows the homeowners to explain in detail all of the reasons they were unable to make payments on their mortgage and why they’ll be unable to completely pay off the mortgage. A good hardship letter can really help you seal the deal.
Financial Statement
This is basically the homeowner’s pay stubs, copies of their past income tax returns and other items that show the homeowners really are in financial hardship. The bank will absolutely want to see this proof of hardship before discounting a loan and taking a known loss.
Suggested Extras to Seal the Deal!
There are a few extra pieces of foreclosure information you can include in your short sale package to get the bank’s attention in this preforeclosure deal.
Cover Letter
The cover letter helps your short sale package stand out. It basically states who you are as an investor and that you are requesting a short sale. It also states why the bank should take the short sale. You can also summarize the major points of your package in this cover letter for the bank officer reading it.
Proposed Closing Statement (HUD1)
Eventually you’ll find that a bank requests the HUD1form. It shows all the fees and payments that will be made to the parties involved in the short sale. It helps them know their bottom line on the deal at a glance. Plus, it ensures the seller is not receiving any compensation.
Opinion Of Value
This can be a professional estimate or your own statement. You’ll back it up with a quick list of all the negative points of the property, its needed repairs and the lowest comparable sales in the area.
Estimate Of Repairs
If this property in pre-foreclosure needs repairs make sure you get estimates for all of them and include those estimates in your short sale package to back up your discounted price. Use the highest priced estimates you get.
Notice Of Trustee’s Sale
This is the notice that the homeowner receives telling them that their property is going to the foreclosure sale. By including this document in your short sale package you are letting the bank know that you are aware of the foreclosure process. It also helps put a timeframe on the deal and can light a fire under them, so to speak.
Color Photos
You’ll get extra points with the bank by sending them pictures of the damaged and neglected areas of the house. They provide photographic evidence of the low market value of the property and encourages the bank to accept your discounted offer.
The short sale package usually contains quite a lot of foreclosure information. In fact, it’s an involved process and essential part of debt negotiation with the bank. The bank will want ample evidence to back up your short sale request for their loss mitigation department as can be seen by the bulleted list. This package contains information that the bank requests from you and your own research on the property including; damage estimates and the homeowner’s hardship letter, all of which work to back up your request for a discounted sale price on the property.
Retrieved from “http://www.articlesbase.com/business-articles/preforeclosure-investing-putting-together-the-short-sale-package-345711.html”
(ArticlesBase SC #345711)
Watch your traffic increase just by submitting articles with us, click here to get started.
Liked this article? Click here to publish it on your website or blog, it’s free and easy!
Colin Egbert -
About the Author:
Colin Egbert is CEO & Co-Founder of http://www.realestateinvestor.com/, the online leader for real estate investing education and networking. Additionally, he established http://shortsaleinvesting.org/, the #1 provider of full-service debt negotiation services for successful short sale investors.
]]>
Questions and Answers
Ask our experts your Business related questions here…
200 Characters left
I was denied a Hamp mod due to NPV caculations. My lender will not explain these terms to me. They said they cannot help me. I need to short sale and get out. Can u please help me
What are tax implications of short sale ?
What are the repercussions of a short sale ?
Rate this Article
vote(s)
0 vote(s)
0) {
ch_selected = Math.floor(Math.random()*ch_queries.length);
if(ch_selected == ch_queries.length) ch_selected–;
ch_query = ch_queries[ch_selected];
}
}catch(e){
ch_query = document.title;
}
]]>
Article Tags:
real estate, real estate investing, real estate investor, real, estate, foreclosure, pre foreclosure, preforeclosure, preforeclosure investing, foreclosure investing, investing
Latest Business Articles
More from Colin Egbert
short sale timing, buying a short sale, foreclosure timing. (03:58)
Short Sale Secrets Clip 2
Learn how to short sale real estate. Bill Twyford and Dwan Bent-Twyford define short sales, outline the structure of deals, and explain the relationship with the banks you need to get those deals done. A.D. Kessler’s Real Estate Roundtable #354 Clip 2 from www.cremag.com.
(01:10)
Learn how to Sell a Home in a Short Sale
Learn how to sell a home in a short sale in this video from experienced realtors and mortgage brokers. (02:54)
Learn what foreclose means and what you can do to get back on track -Learn about Short Sale? (00:42)
Investing Tips: Short Sale - Part 3
Learn how to: Bill and Dwan Twyford discuss the details of the short sale and offer many other options for investors to use when assisting the homeowner in the beginning stages of foreclosure. A.D. Kessler’s Real Estate Roundtable #357 Clip 3 from Creative Real Estate Magazine at www.cremag.com. (01:04)
Investing in Foreclosures — Why Do Short Sales?
Foreclosures are one of the biggest ways to cash in on real estate investing. But what about short sales? What are they and how can they help you? Colin Egbert discusses the ins and outs of short sales to cash in on your real estate short sale.
By:
Colin Egbertl
Businessl
Mar 09, 2008
Mortgage Foreclosure Investing Not Working? Go With Tax-Delinquent Property Instead
If you’re hoping to get your start in real estate investing, one of the first places you probably looked was mortgage foreclosures. You probably contacted (or tried to, anyway) owners of properties who were about to lose their homes due to non-payment of their mortgage. If you were lucky enough…
By:
Olliver Kennedyl
Finance>
Real Estatel
Jul 24, 2009
Pre Foreclosure Listings Houston
Let’s countenance it, foreclosure information is public domain. That measures that real estate investors can right to use this information any time they feel like, nationwide, with a little determination. The trouble is, the foreclosure properties investors are actually searching for, are not that trouble-free to unearth or contrast to one another. That is where foreclosure listings in Houston Texas move toward to your help, serving you locate foreclosure investment opportunities tha…
By:
Edwin Shepherdl
Business>
Business Opportunitiesl
Dec 02, 2009
Ohio Foreclosures and How They Work
Ohio foreclosures basically have the same foreclosure rules just like most other states. If you plan to relocate or purchase an investment property in Ohio, then you may want to know the basic Ohio foreclosures regulations and proceedings.
By:
Claud Pearcel
Finance>
Real Estatel
Sep 29, 2010
Before that the property is foreclosed, the bank provides the homeowner a grace period, and is called preforeclosure. When the owner is behind on payments or if they have always managed to pay their debt, the bank begins foreclosure, but because the owner still has the option to sell the property immediately before the auction closes
By:
Yasir Samadl
Business>
Business Ideasl
May 11, 2011
Healthcare Data Analysis Through Specialized Tools
One of the major shifts in the surgical and healthcare sector of late has been the detailed exploration and analysis of Healthcare Data with the help of advanced tools. There has always been a growing concern of accountability in the sector with such sensitive surgical procedures being performed on a regular basis
By:
Edmund Brunettil
Businessl
Jun 11, 2011
The Advantages of Professional Water Damage Restoration
Almost every household across America has, at some point of time, required water damage restoration. Broomall itself has many residents who have faced this situation. However, the intensity of the problem differs. While some may have to deal with a broken faucet, others may have to encounter a flooded basement or even worse. The problem with water damage is that you cannot get rid of it by yourself. If you try, you might end up doing some permanent damage to your house in the process. …
By:
melvillejacksonl
Businessl
Jun 11, 2011
Why Should Water Cleanup Be Done By Experts Only?
In addition to causing immediate cosmetic damages to the building and property, water damage also causes adverse structural problems to the building and health hazards to its residents. If moisture is left to retain onto the structures for more than 48 hours, it will lead to severe damages. Immediate water cleanup can prevent damages like swelling of the masonry structures and rusting of the metallic ones of the house. However, mildew formation is the most dangerous problem that most h…
By:
melvillejacksonl
Businessl
Jun 11, 2011
Electric Repair for Homes in Fishers
Electrical systems and plumbing, though they are different, can be considered parallel to each other. They are parallel in the sense of their working mechanisms. Water makes its passage into your home through pipes and electricity through wires. To keep them working properly you need to maintain them from time to time and get it repaired when required. Whenever you see problems in the wiring of any electrical appliances, you need to have electric repair. Fishers, IN has got many well t…
By:
orsondixonl
Businessl
Jun 11, 2011
Electric Repair: Choosing the Best
Damage to the electrical wiring of your house can occur at any point of time and you need to know who to call up to get it fixed. While this may seem like an easy task you need to be very careful while choosing an electrical contractor. When it comes to electric repair, Carmel residents only trust only a few contractors. This way they ensure that the service they receive is nothing short of the best. Many people try to take matters into their own hands and fix what they think is a sim…
By:
orsondixonl
Businessl
Jun 11, 2011
Short Sale Negotiation: Preforeclosure Phone Calls With the Homeowner
A really nice article with short sale tips and how to do your best with your short sale negotiation, focusing especially on preforeclosure phone calls with the homeowner.
By:
Colin Egbertl
Business>
Home Businessl
Aug 05, 2008
lViews: 170
lComments: 1
Investing in Foreclosures — Why Do Short Sales?
Foreclosures are one of the biggest ways to cash in on real estate investing. But what about short sales? What are they and how can they help you? Colin Egbert discusses the ins and outs of short sales to cash in on your real estate short sale.
By:
Colin Egbertl
Businessl
Mar 09, 2008
Short Sale Negotiation – Tips For Pre-Foreclosure Investing
A really nice article with short sale tips and how to do your best with your short sale negotiation.
By:
Colin Egbertl
Businessl
Feb 16, 2008
lViews: 6,080
lComments: 1
Add new Comment
Your Name: *
Your Email:
Comment Body: *
Verification code:*
* Required fields
Submit
Your Articles Here
It’s Free and easy
Sign Up Today
Author Navigation
My Home
Publish Article
View/Edit Articles
View/Edit Q&A
Edit your Account
Manage Authors
Statistics Page
Personal RSS Builder
My Home
Edit your Account
Update Profile
View/Edit Q&A
Publish Article
Author Box
Colin Egbert has 4 articles online
Articles Categories
All Categories
Advertising
Arts & Entertainment
Automotive
Beauty
Business
Careers
Computers
Education
Finance
Food and Beverage
Health
Hobbies
Home and Family
Home Improvement
Internet
Law
Marketing
News and Society
Relationships
Self Improvement
Shopping
Spirituality
Sports and Fitness
Technology
Travel
Writing
Agriculture
Ask an Expert
Business Ideas
Business Opportunities
Corporate
Customer Service
Entrepreneurship
Ethics
Franchise
Fundraising
Home Business
Human Resources
Industrial
International Business
Leadership
Management
Negotiation
Networking
Non Profit Organizations
Online Business
Organizational
Outsourcing
Presentation
Project Management
Public Company
Public Relations
Sales
Six Sigma
Small Business
Strategic Planning
Team Building
Training
]]>
Need Help?
Contact Us
FAQ
Submit Articles
Editorial Guidelines
Blog
Site Links
Recent Articles
Top Authors
Top Articles
Find Articles
Site Map
Mobile Version
Webmasters
RSS Builder
RSS
Link to Us
Business Info
Advertising
Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2011 Free Articles by ArticlesBase.com, All rights reserved.
Colin Egbert is CEO & Co-Founder of http://www.realestateinvestor.com/, the online leader for real estate investing education and networking. Additionally, he established http://shortsaleinvesting.org/, the #1 provider of full-service debt negotiation services for successful short sale investors.
Entries (RSS)