Short Sale Negotiations

OK. so you've done your research to find the best way to short sell your property and you landed here. Why us? As you will see, no real estate agent has the expertise in negotiating with a lender that has already calculated it's in their best interest to foreclose on you.

First; four definitions:

- A short sale is defined as convincing your lender(s) to accept less than the current mortgage balance as payment-in-full for your distressed (or 'underwater') mortgage.
- The 'deficiency' is the difference between selling price and mortgage balance.
- The BPO, or Broker Price Opinion, is an informal appraisal of efficient selling price for a distressed property. (This BPO is paid for by the current lender, oddly enough.)
- Jumbo mortgages over $760,000 are a special situation discussed below.

There are four basic steps to consider in finding your best short sale strategy:

Speed and Efficiency of bank negotiations
Negotiate all liens and deficiencies
Negotiate reporting to credit bureaus to minimize credit report damage
Finding a qualified buyer to purchase your distressed property

Speed and Efficiency:

Loss mitigators at your lender are paid commissions and bonuses to settle distressed mortgage applications, or short sales. These loss mitigators at your bank can be counted on to 'cherry-pick' the best short sale deals.

You need an expert at packaging your short sale offer to get it to the top of the heap. We know how to find the most motivated loss mitigator at your lender. This includes finding a mitigator willing to literally 'walk the file' to another department if need be. It happens.

We pride ourselves in negotiating and closing short sales in 60-90 days.

Lender-accepted short sale applications are classified into three tiers, or levels, of attractive short sale applications to your bank:

Total Loss to bank

Offer-to-Value

Net-to-Value

- Tier 1 applications satisfy all three criteria (these are approved in-house and are therefore the fastest to be approved),
- Tier 2 applications satisfy two criteria (these are fast tracked to the investors on the loan),
- Tier 3 applications satisfy one (these are sent to the Investor Management companies. They take the longest to negotiate and approve).

Obviously you want your short sale application to meet all three criteria and be a Tier One application. That's what we do.

Your lender has already calculated a 'Net Present Value' which is code for the tipping point for them between a short sale or foreclosure. We teach the bank 'How to Take A Haircut', or loss.

Short Sales are negotiated off of Principal Balance. Any late fees, or other insundry exta charges tacked on by your bank are also negotiable. Your mortgage may have as many as eight different investors that must sign off on a short sale. We chase down all involved investors.

Short sales are often declined for differences as little as $50 between application calculations and the bank's calculations. We know that they re-arrange the figures. The bank loss-mitigators are forbidden to reveal those mistakes. Our experience enables us to find and correct them. It can mean the difference between acceptance and denial. Having an experienced, motivated negotiator on your team means recognizing those miniscule stumbling blocks and knowing how to correct them. We know our enemy.

Our chief negotiator has been at this since 1994-we know the bank's guidelines. Knowing the banks have a team to squeeze every penny, we have our entire nogotiating team in one office to enable collaboration also.

No single party can afford the time, energy, or expertise to do all three steps. A real estate agent's expertise and effort is best used to market your property and find a qualified buyer. It's what they do.

Negotiation of all liens:

You, the seller, are ultimately responsible for any deficiencies. It's not fair, but it is reality. You are empowered to negotiate those deficiencies before foreclosure. You give up that right at foreclosure.

Your lender can be counted on to pursue loan deficiencies even after a foreclosure. It should be obvious that you're better off letting a professional negotiate any deficiency BEFORE your foreclosure.

Marketing to a Qualified Buyer:

Almost all short sale articles indicate the need for a listing agent. Until recently, they were the only ones expected to represent the best interest of a 'distressed mortgage holder.' There are any number of them that have taken any number of short sale courses in an effort to assist the current distressed mortgage economy.

Those classes, unbeknownst to you however, advise them to partner with an experienced short sale negotiator. The willingness to leverage expertise in short sale negotiations depends on the ego of the enlisted agent. The obvious question for the distressed homeowner becomes, "Why not eliminate the middle man?" The distressed homeowner doesn't need a listing agent, they need an experienced negotiator. THEN they need an experienced property marketer.

We count on the ability of an agent to represent the potential buyer and use all of their resources in marketing and selling the property to fully consumate a win-win-win transaction for all concerned.

Bad BPO:

Another obstacle to a protracted short sale is a bad BPO, or Broker Price Opinion. If the Broker assigned by the bank does an inadequate job in their BPO, this stalls, or even dooms the short sale negotiation.

We counteract a bad BPO by performing an expert Market Analysis and get an experienced Licensed Appraiser to sign off that analysis.

Jumbo loans and Luxury Properties:

Luxury properties, basically Jumbo Loans over $760,000, require special attention because of the potential loss to the lender. We know how to handle these, too.

Your Credit Rating:

If you short sell your property, you can remedy the lesser damage to your credit and purchase another home in as little as 2 years. The damage to your credit with a foreclosure will hound you for 7 to 10 years. Our negotiations also focus on mitigating the damage to your credit rating, as well as all consumer liens and HOA dues. I can help you with disputing the reporting to your lender on your credit report. Your lender will undoubtedly not help here.

Our Mission:

The distressed homeowner is advised that we are investors and are engaged in short sale negotiations to make a profit.

However, if it comes to a point that we can't make a profit, we will step aside, enabling the sale to close without a profit. The relief made possible by a successful short sale to the distressed homeowner is our paramount goal. Our experience indicates that withdrawing from negotiations and allowing a successful transaction occurs 50% of the time. We count on our total accomplishment success rate, as well as earning an honorable profit.

Real Estate Agents:

Please contact me for our recruiting program of Buyer's agents.

Foreclosure?
Hell, I'm gonna shoot something!

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