INSIDER SECRET #1: Just order the package already!
A common mistake with new and experienced investors alike is to ask the lender IF they will accept a short sale on a property. When you make contact with the short sale department for the first time, all you need to do is order the package. And when you order it you should ask them to FAX it to you. Don't ask them to mail it to you, as you can't afford any delays.
INSIDER SECRET #2 - Information Overload
Every short sale pro knows that you should always give the bank more information in the short sale package than they ask for. The more information you give them, the faster the lender will be able to give you an answer.
Even if the lender doesn't ask for these items, the successful foreclosure investor knows to include (among other things):
- Paycheck stubs, tax returns, and recent bank account statements (if they support your case)
- A handwritten hardship letter
- A Purchase and Sales agreement with few (or no) contingencies
- An estimated net sheet / HUD-1 (could this be a shameless plug for EasyHUD.com?)
The estimated net sheet (HUD-1) that you will submit is one of the first things that the lender will pull from the package. They will begin looking for instantly recognizable RED FLAGS. Do you know how to make your HUD-1 "Short Sale ready"? Get your HUDs RIGHT NOW by going to www.EasyHUD.com!
INSIDER SECRET #3 - On your mark, get set, GO!
As soon as you get your short sale package, get it completed and back to the lender within 24 hours. Don't forget to include the items we discussed in the Insider's Secret # 2.
Remember that you are working with a very tight timeline and the sooner you get the package in the lender's hands, the sooner they can start reviewing your offer.In some states you may only have 21 days from the time the bank starts the foreclosure until the house is sold at auction! Once the lender starts reviewing your package, the pressure gets turned up! You are about to start the negotiating process, which is where the REAL money is made.
Insider Secret #4 : What's your number?
Unless foreclosure filings slow down soon (which ain't happening!), you may have a difficult time actually getting the lender on the phone.
When you do make contact with the loss mitigation specialist who will be handling your offer, make sure you get the following information:
- The Loss Mitigation specialist's direct extension,
- Their email address (always try and get their personal email address as a backup)
- Their fax number, and whether or not you should include a cover sheet each time you transmit
- Their mailing address in case you need to send pictures, a Thank You note (hint, hint), or other documents.
So now, when your voicemails don't get returned, you will be ready to start your communication blitz and increase your chances of making contact.
Insider Secret #5 : How low can you go?
When making your offers, a rule of thumb I have used with great success is to offer 50% of the writ amount on first mortgages and 10% of the second. If you are lucky enough to have a third mortgage to discount, they can kiss their hopes of getting more than 1% - 10% goodbye!
Don't be afraid that these offers are too low because all the bank can do is tell you to raise your offer. They won't laugh at your offer or hang up on you, so don't worry.
When you decide to get serious about the business of foreclosure investing, you will need to access to the same tools that the "gurus" use. You will need www.EasyHUD.com!
Insider Secret #6 : The squeaky wheel gets the grease.
Now that the lender has your package and you know how to track them down you MUST follow up, follow up, FOLLOW UP! It will show the bank you are serious, and you will know about any potential snags with your deal as soon as they pop up. If you wait on the lender to take the initiative to call you, you may be in for a long wait. With all of the files the banks have in their short sale departments, they actually appreciate your diligence.
One more Insider Secret to go! We at EasyHUD.com have a FREE forum for foreclosure investors. This forum is moderated by our most successful members, and problems are solved daily over here!
Insider Secret #7 : What do you mean "NO"?
Although most lenders nowadays are giving discounts, just because you ask for it doesn't guarantee you will get it. That is why you should always have at least a couple of deals cooking just in case.
Nothing is worse than getting all excited about a huge discount that never happens.
The better you get at handling simultaneous deals, the sooner you will start carving out your slice of the big money being made on Short Sales.
Chris Daigle is a full time Real Estate investor and owner of EasyHUD.com and MyInvestorLink.com. He has tons of free resources RIGHT NOW for investors who are serious about making money in Real Estate!
