We received a question from another agent on short sale negotiations. Here was their email.
"I am having a problem on a short sale and would like to know how to avoid
it next time. The first mortgage gave me a price and a net they would allow.
The home sold for enough money to get them the price and their minimum net they said they had to have. We put together the closing statement with the first
receiving what they wanted and the second mortgage receiving $9,600.
The second had asked for $15,000 and are saying that they won't accept less
than that. Any suggestions on this one? What would have been a better approach? Maybe offer the 2nd a smaller amount to start?
I used the same HUD to present to both, getting the firsts approval first.
Please advise. Bonnie."
Here was our answer to Bonnie's Question. Here is what I would do to avoid this in the future. Put together two separate closing statements, one for each MTG company.
The first mortgage would see a proposed closing statement with $20,000 going to the second mortgage. Meanwhile the second mortgage would get a proposed closing statement with them receiving $3,000 and the rest going to the first mortgage.
Obviously they are going to get the same HUD at closing. But, you start
negotiations with each mortgage company thinking that the other mortgage
company is getting a huge sum.
You meet in the with the final closing statement. They will both be happy
because they are getting more than they had originally expected. Now,
what can you do now to close this short sale?
This second mortgage negotiator is being a little unreasonable. Most second
mortgages only receive $3,000 normally. They should be more than happy
Remind them that they get zero in a foreclosure. Show them the docket status
for the foreclosure case. If the house is close to foreclosure, then you gain
more negotiating power.
Another thing to do is get both of the negotiators on the phone. Have them hash
it out between each other. That worked for us on a deal before and it might
work for you too.
If you have any questions about a Short Sale, Please feel free to contact me by email at firstname.lastname@example.org or, if you prefer, you can call me at 770-875-4268.
Thanks for reading this, Bion Grady.
Bion is a Real Estate Agent at Maximum One Realty Greater Atlanta.
Bion Grady specializes in loan modification assistance and short sales in
Georgia. Loan Modification Help, Short Sales. Short Sale Realtor.
Copyright 2012 SFI Marketing Institute, LLC. All Rights Reserved.
This is not intended as legal, technical, or tax advice. Please speak with a
licensed professional before making any decision. Information is deemed
reliable but not guaranteed as of the date of writing.
The views expressed here are Bion's personal views and do not reflect the views
of Maximum One Realty Greater Atlanta.