Tuesday, August 14, 2007

The Weird World Of Short Sales

If you are in the short sale game right now then you understand that lenders are playing hardball and it seems to be a nationwide challenge.

I recently took a 300K first down to 200K. Things were looking good! Then I had to deal with GMAC on the second. Shouldn’t be a problem, right?

Boy was I surprised when GMAC was not willing to do anything. After a long healthy conversation with the Loss Mitigation Supervisor I learned that GMAC will only accept a short sale that comes in at 95% of the market value.

Okay – you can stop laughing because this is not a joke. The supervisor AGREED with me that something today beats nothing at the foreclosure. He KNEW their policy was insane but his hands were tied.

What are my choices?

1) I could buy the note and finish the foreclosure. Tried that but the 1st wasn’t willing even though they get the same net.

2) I can continue to negotiate hoping GMAC’s policies will change – they may.

3) I can hope GMAC sells the loan to another lender then start over.

The reality is this deal is likely dead and I know it. Luckily I have honest direct relationships with my sellers so I informed them and they want me to continue. Time will tell if I get it through.

Tip For The Day: Short sales are a numbers game – do not get emotionally involved. Some will work, some won’t. Just make sure you can quickly prepare short sale packages. REPP does the job.

Now go buy a house!

Gerald Romine

PS – Things are changing at www.kickassrealestate.com. Check it out.