BiggerPockets

I have a client who is renting a property that is currently in foreclosure. He loves the home and would like to purchase the property.

The current owners have agreed to allow a short sale although my client just called me and said that some real estate agent called him and needs to come and take photos of the home because it is going on the market. The lender is listing the home.

Question:

I would like to transact a short sale to wholesale and profit off of this deal. I am new to short sales, thats why I am asking.

What would be the exact way to go about this?

Thanks for all of your advice.

There's too many parties cutting into this deal - walk away. Unless the agent can't make it happen, and then it's all yours. However your talking to the tenant and not the owner - who has control of the property. You cant work a short on behalf of the person with no control of the property. Talk to the OWNER.

Update:

The owners have listed the property with a relative so it is not the lender who is listing the property.

I spoke to the agent and he is going to give me 25% of the commission on the sale so I am going to write the offer and see where it goes.

Let me know if you guys have any more suggestions. Thanks for all of your advice.

Cheers.

Not that it is your problem, but be aware that the agent can not give you 25% of the commission (in CA) without violating agent rules and could lose the license. Most will not do this as they would not want to risk losing a license over 1 sale.
Anything in writing would leave a paper trail too, so how do you guarantee yourself your portion?

Sean,
Will makes a good point about the 25% you were told you could have from the realtor. Is it legal ?no. Does it happen frequently? yes.

Why not associate with better people who can do more with less hassle and not break the law.?

I see a lot of first timers asking questions on how to save a deal.
The best way to save some deals is to walk away and live to find another.

Take the long view and get a team put together, a team of skilled professionals so you can do this again and again.

Need help to assemble the team PM me. I can tell you how or do it for you. These people don't charge you a penny, neither do I.

The deals are out there and they will keep coming. Don't focus on just one especially if it is tainted and puts you anywhere near a dirty transaction.

This web site is public and you have just stated in a public forum something that is frowned upon by the DRE.

I disagree with Will on one point though, it is your problem here's why....
A very aggressive DRE person, not that I ever met one, could make the case that you may have performed an act which requires a license which is a violation. This is highly unlikely because the DRE is mostly a toothless one eyed watch dog that don't even bark.
But what if the agent gets in trouble and you spend hours in depositions being questioned as a witness. Its not worth it.

Do clean deals and do lots of them and you won't waste your time in court explaining things and you won't have to give the money back.

Will,
You are right. The cases I have seen of DRE playing cops and robbers are few and far between and I never saw one end in a prosecution of any kind.

I have seen some pretty dumb things happen to people at local board hearings and the DRE and they were not prosecuted as you point out but they did have to spend time in depositions and hearings for standing too close to the grey line which is the advice I believe you and I are both offering here.

Its quite probable I've met more unlucky people than you have.

I believe we are both hoping that Sean here does not join the ranks of the unlucky.

Sean, on the resale and buy side you will have closing costs.
Why not let the agent give you the 25% of the commission towards the costs. It's legal, on the HUD, and more $ since (usually) thats off the top, before the broker takes their cut. Clean, simple, legal.