If there is any single group of people who are uniquely poised to help with the housing crisis, it’s real estate investors focusing on foreclosures, and more specifically those who are short sale experts.
Yet that’s exactly the group of people being punished by the new legislation passed by the government this year. Both the “Hope for Homeowners” act and the more recent Bailout Bill offer “relief” to lenders caught up in the credit crisis. But those same pieces of legislation cause harm to the foreclosure-oriented real estate investors by giving the lenders reasons not to approve discounted REO sales and short sale transactions.
“Banks are also holding off on selling foreclosed properties and doing short sales, again hoping to get a better deal” says CNBC’s Diana Olick. The net effect is that investors of all types and sizes are being shut out of the foreclosure market. This, despite their being the single group of people most likely to purchase foreclosed properties and to provide much-needed liquidity in the real estate market.
This is yet another example of how government interference with the free market hampers economic progress.
Though I’ve been involved in several short sales, I’m far from a short sale expert. If you’re “in the trenches” in the short sale business or in the REO business, tell us about your experience in the last several months. Has it been easier or harder to get transactions approved? How long does it take? Do you have any good hints or tips?
As always, thank you for reading Bryan Ellis’ Free Real Estate Training - your comments and questions are welcomed below.
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6 Comments So Far»
Hey Bryan
I have actually been experiencing quite the opposite.
We have been getting deal after deal approved as shorts, consistently getting 1 per week.
As a matter of fact our most recent one, a short that was approved yesterday, was as follows.
1st Mtg principle 238,000
2nd Mtg 37,000
The above with arrears (14 months) legal fees taxes etc comes to about 300k
It took us just 45 days from getting the docs over to the bank to getting it approved… The banks accepted
…….$85,500 on the first and 1k on the second.
This deal will yield us after repair costs buying selling and holding g costs just over 75k …
Not bad for 4 hours worth of work..
I have to admit, it wasn’t always like this for me. I use to get the run around, get denied and get frustrated. I was about to throw in the towel 2 years ago, but instead I figured out 7 different strategies that have literally skyrocketed the approval rate as well as the haircut we look for in the deals… Wasn’t easy but experience, systems and these strategies are worth their weight in gold.
Billy
P.S Love the site man. Keep up the great work
That’s great news Billy! This is exactly why I appreciate having first-hand reports, because frequently the theory and the facts don’t align. Best wishes for continued success! — Bryan Ellis
It’s interesting that you asked. My negotiators have noticed that the lenders are moving shortsales much more quickly just this week. Files that were backed up are suddenly assigned negotiators and they’re willing to talk. I think they’re less grumpy about losing so much and maybe feeling nice since they see a handout coming. I don’t know. At least for now, they seem ready to deal.
Excellent! Hopefully we’ll find that the CNBC report was wrong! — Bryan Ellis
Bryan-
Funny you mentioned this. I got involved with a short sale program from DC Fawcett, and I still have not received this month’s pre-foreclosure leads, perhaps due to this that you mention in the article. In fact, since I’m also working with Brad Wozny of 8 Figure Empire, he asked me about “seller regret”laws regarding short sales. The DC people still haven’t responded to my inquiry,instead trying to refer me to their q&a forum.Typical,like you say, of government economic interference.
Hi Bryan, Thank you for your continued efforts. I always look forward to your emails as we do think alike in many regards. I have been doing short sales in CT. and have found them to be increasingly difficult to the point that I am working on changing my investment focus to other forms of investment. Lenders are very difficult to deals with of late and we are offering good money for these properties. Normally around 70% of the loan values without any repairs included with little success. I’ve worked on short sales for 6-8 months without getting approvals, it’s rediculus. Countrywide has been very difficult and I don’t know if it’s the takeover by Bank of America or what? They delay the foreclosure to deal with the offer but you cannot talk to a loss mitigator and work out a deal. All you get are phone jockies that supposedly pass the offers/info along to the loss mitigator. I cannot wait for six months for these deals to come to fruition. The Government has wrongly interjected it’s athority and our taxpayer funds here and lenders are just waiting for the next boatload of money to come along. It’s disgusting!
By the way I am very interested in your Internet domination system. I hope at some point I can afford to get involved. As someone who is trying to break into internet marketing I’m very immpressed.
Thanks,
Ralph
Live in the Phoenix area and have run into problems here for ourselves at least. Seems like things while not coming to a halt are much more difficult.
I think you will find it varies from region to region and bank to bank.
We have found BofA to be hard to deal with like Ralph.
Just my opinion but I think in the long run this will turn into a real mess, have to wait and see.
Chris
Agreed - let’s let the free market alone - it will do a good job IF we, the Fed, the COngress and the President stop messing with it. Kent
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