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Article by Scott Rister
Close More Short-Sale Deals Than Ever Before!

  Let me just get right down to the point....short-sale deals are EXTREMELY popular because they're just so darn profitable. It doesn't take a rocket scientist to figure out when you can buy (and/or control) properties at 50-70% on the dollar that you can make money in real estate. BIG MONEY!!

  In fact, if your goal isn't to make truly great deals happen then please contact me as soon as possible because I know an Amway rep and other MLM schemes you can do....but you shouldn't be in real estate!! I'm that serious about it.

  With that out of the way and off my chest let me key you into a technique that will help you out considerably if you're into negotiating short-sales for big profits. In fact some of you may already have figured this out by now, but for the sake of us all let me go through some general points about what a short-sale is, the process, and how you should be streamlining it so that you get more short-sale deals accepted than ever before.

  First off a short-sale is nothing more than the lender accepting less than the current payoff of a loan balance including late payments, penalties, fees. This means that if the loan amount is $123,516, that yes lenders will accept a quick $79,000 if the conditions are right and all the indicators line up for the lender that it is best to cut the deal to get it off the books and move on.

  I'm not here to go over from A-Z on the short-sale process and all the nuances along with it. However, here is just a very basic summary of what must be ORDINARILY submitted to the lender in order to consider if they will short-sale the property:

  1. Contract between seller and buyer (you being buyer)
  2. Final Broker's Opinion (BPO) of property value
  3. Net Offer Statement---HUD statement referred to
  4. Repair estimates
  5. Paycheck stubs of seller
  6. Hardship letter from seller
  7. Financial Statements of Seller
    1. tax returns
    2. bank statements
    3. personal asset statement

  Most items needed to get going for the short-sale package to be considered are pretty much cut and dry. Where I'm getting with my whole point here though are items #5-7 listed above. Have you ever had trouble getting this info from a seller? With me, sometimes its enough to pull my hair out and scrap the whole deal sometimes.

  At times I'll get a deal going and the seller all gung-ho about getting this thing squared away and behind them. Then, somewhere and somehow along the way they just lose interest and at times resolve themselves to the fact that the situation is dismal and that they guess the lender will foreclosure and that I can't actually help them head off having a foreclosure and deficiency judgment rendered again them.

  In fact I've had some deals that have just fallen apart because the seller flat out gave up on me. This is especially true when at times I'm needing specific information the lender is requiring such as personal bank statements and etc.. The worst-case scenario is like if they are self-employed and require cashflow and operating statements verifying the financial trouble they are in and their business. You're then asking them to go to their CPA and get all these reports done at the snap of a finger.

  All of this what I'm stating and getting to is that the seller of your potential short-sale deal is like a fish on the line. It takes skill and just common-sense smarts to get the deal to closing and bottom-line "Big Kahuna" profits in your pocket. Pulse check here.... isn't that what this is all about, profits? So, your fish is on the line and you wan to set the hook so they don't get away.

  Let me recap once again the items the lender is requiring from the seller in order to CONSIDER accepting a short-sale offer:

  1. Paycheck stubs of seller
  2. Hardship letter from seller
  3. Financial Statements of Seller
    1. tax returns
    2. bank statements
    3. personal asset statement

  Wouldn't it be nice for everything just listed to make it all go away and you not have to deal with and submit to the lender? Well, there is one thing that has worked great for me in certain circumstances and really cuts the red tape out of this process. GET THE STINKING DEED!!!

  When the seller deeds me the house, I skip all those time-consuming steps and get down to brass tack with the lender:

"Mr. Lender I've been trying to work out a situation with the seller but quite frankly they're some of the most emotionally distraught people I've ever met. In fact, they simply said they're outta here and deeded me the house only after I pleaded with them that it was the right thing to do in at least securing the house so it doesn't just stay open for months if they follow through on filing bankruptcy."

  Let's just say the lender will look at things in a much different light. You want to be perceived with the lender as the lone beacon of light in this entire process that half way makes sense and that you're on their side in order to get things squared away with the house.

  Ok, I can already hear some of you out there screaming right now with all those seller objections that you have to overcome on them deeding you the house. You don't HAVE to record the deed they the seller gives you and can be quite up front on your intentions to use this as a negotiating tool. Yes, in fact they just handed you the deed to the house and until foreclosure they would have still technically been the homeowner.

  To squelch any objections with the seller you simply must ask them really what negative consequences for you will there be if you deed me the house? There is not really any intelligible answer because in a short-sale deal they are already considerably behind on payments and writing is on the wall with foreclosure  ..not a matter of if foreclosure will happen but just when it will.

  Yes, I use to go through all the steps gathering that junk of information that the lender traditionally wanted until I just got sick and tired of hounding that information down from the seller. However, I can remember one deal that I lost because the seller just said they don't have the time/money/energy to deal with it going to their CPA for all these reports needed.

  In the situation of the previous paragraph that deal just kept bugging me for a couple of weeks until it dawned on me why I didn't just get the deed and eliminate all that red tape the lender was requiring. From that time on, I started getting simple deeds signed off on using my previous line to the lender and funny thing happened….. I GOT MORE SHORT-SALES ACCEPTED!!

  That is what this is all about is getting more offers on your short-sale deals accepted. The short-sale process is like a bunch of small hurdles to overcome and not any one huge one. However, if you can substantially eliminate the amount of lender requirements to consider your short-sale offer, then you're WAY ahead of the game in making big money in real estate.

Good hunting as luck has absolutely nothing to do with it!!!!

-----         -----

  Take a quick check of your marketing program and tune it up if needed so you too can, "Find All The Motivated Sellers You Can Handle!".

Visit Scott Rister's Wholesaling and Marketing Forum

Scott Rister is an author and "real world" investor just like yourself. Scott started investing in real estate over seven years ago for the sole reason so many do which is to supplement income and eventually replace the corporate job. After learning first hand what "down-sizing" in the corporate world means, Scott focused more intently on shifting from emphasis from buying techniques to finding truly motivated sellers. In less than a year Scott has been involved with over 60 real estate transactions that ended up with a check with his name on it. You can learn more about his program at
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