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Forums » General Foreclosure & Pre-Foreclosure Forums » MLS Good Foreclosure deals are drying up!!!!

MLS Good Foreclosure deals are drying up!!!!

17 posts by 7 users

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Wholesaler · Gainesville, Georgia


I'm back hunting for foreclosures but apperantly there is a shortage of good deals & the ones available are flying off the shelf with people paying more than I would.
Is it time to break out the We Buy Houses, etc.?
Thoughts plz...

l.Souza-GA



Hard Money Lender · Tempe, Arizona


It appears in many areas the rock bottom deals are no longer available on MLS. Alternative and less efficient deal flow sources are needed.



Real Estate Investor · Springfield, Missouri


Time to beat the bushes? Why not pick them up before they get to the bank?


Financexaminer@real estate investor dot com


Wholesaler · Gainesville, Georgia


Not sure about SSs!!!! if that's what you mean...



Real Estate Investor · Springfield, Missouri


Nope, just get with the loan officers in the banks, make friends, tell them what you can do, how you can payoff that slow pay note. When they have a slow pay or a PITA borrower, they can suggest talking to you. It's not an endorsement of your services, but if you can really help they will listen. Sellers call you!


Financexaminer@real estate investor dot com


SFR Investor · Annapolis, Maryland


It seems these days short sales are better buys than listed foreclosures, at least in the areas we look at. There was a recent Homepath in an area we always keep an eye on in Virginia Beach, but listed 50K higher than 2 recent closed short sales, and seems to need more work than both. Here in Annapolis, we bought a short sale as every foreclosure we walked into had major issues (rotting foundation beams, drainage problems, mold, etc.), and the banks wouldn't come down in price enough to make it worth the risk. Seems like only the rotten apples are getting to foreclosure now that short sales are faster and easier to obtain.



SFR Investor · Texas


@Lynn M.,

Do you think foreclosures list higher than short sales because of the extra costs the bank incurs through the forclosure process as opposed to a short sale?



Real Estate Investor · Springfield, Missouri


Not really, it's apples and oranges. With REOs there is a set proceedure to go through, they actually need to seek the highest price and then begin lowering the price, when they get to the payoff and costs they begin writing down, as time goes on there are automatic reductions on the books.

SS are simply an agreement to take less than the payoff and write off the amounts immediately, it could very well be less costly, but even as they drag their feet, it's quicker and eaiser than a FC sale where they venture into the unknown.

I would imagine that getting to pre-foreclosures or slow pays would probably lead to SS when the values are discovered, but there can be assumptions there as well for those who can buy or just straight purchases. The thing is that these are open to various ways to get the mortgage back on track, leasing it, an option, sub-2, CFDs what ever, work with small to medium size lenders that have local authority, they can be a gold mine and a win-win-win deal.


Financexaminer@real estate investor dot com


Wholesaler · Gainesville, Georgia


So... how are SSs easier to deal with than 2yrs ago?.. & what has improved in the process??

Thx



Real Estate Investor · Springfield, Missouri


Originally posted by Luiz Souza:
So... how are SSs easier to deal with than 2yrs ago?.. & what has improved in the process??

Thx

Two years ago, weren't servicers hiring ex-Walmart employees to staff servicing and dispositions of RE? I'd say the learning curve for the lenders, the more you do the better you get at it. Seems, for example, lenders had all kinds or requirements, disclosures, etc. as they implemented SS, I'd say now they have what they really need and are aware of the transactional documents and systems for an easier flow. Overall.....

Additionally, regulators have probably gotten better in making standardized requirements, anything new is usually a snafu....


Financexaminer@real estate investor dot com


· West, Michigan


The easy pickings on the MLS are almost gone. Having multiple agents pushing shorts to me works. Almost all the deals now we pick now never hit the market.



SFR Investor · Annapolis, Maryland


Also, I think there was a lot of pressure put on the banks to simplify the short sale process -- like I think now banks have a 45-day or some other time requirement to accept or deny an offer, where before, I think they could let it sit for months and months. But it just seems that if there is only one lender involved, the short sale process has definitely improved.



· West, Michigan


I know where fannie may can stick their homepath program. What a crock they hate cash buyers.



Real Estate Investor · Ellicott City, Maryland


Originally posted by Luiz Souza:
So... how are SSs easier to deal with than 2yrs ago?.. & what has improved in the process??

Banks are a lot more willing to negotiate short sales these days than they were two years ago -- I assume it's the fact that banks are finally willing to accept a couple things:

- The number of owners in distress is NOT decreasing rapidly
- It costs a LOT to foreclose
- Balance sheets look MUCH better without lots of distressed assets on them

That said, you're in Georgia, and this is a tougher state to do short sales than most others, especially these days. Not only will most lenders require that the short sale be listed on the MLS (true in all states), here in GA the only people legally allowed to negotiate with lenders on short sales are licensed Mortgage Loan Originators (MLOs).

If you're not an MLO, you can't legally negotiate short sales -- that includes real estate agents and attorneys. You can pass paperwork back and forth, you can provide comps/CMAs, you can answer factual questions, but you can't do anything that even resembles negotiating (it's a very fine line).

So, unless you can find an MLO to work with, you're basically going to need to have the seller negotiate their own short sale, and you're going to need to get very good at coaching the seller. Otherwise, while the seller will be able to get the short sale approved, they probably won't be able to get you the price you want as an investor.

This has been my experience...


Small_lishproplogoJ Scott, Lish Properties, LLC
E-Mail: [email protected]
Telephone: 770-906-6358
Website: http://www.123flip.com
CHECK OUT MY BIGGERPOCKETS BOOKS: http://www.biggerpockets.com/flippingbook


Real Estate Investor · Springfield, Missouri


Jason, not disagreeing with you at all, but it sounds awfully strange that an attorney can't represent someone in a contratual obligation. They do so in bankruptcy for all or part for the forgiveness of debt.
You have pointed out that GA is different, but I just wonder how that ever got past lawmakers in the state knowing many were probably attorneys. And what about non-profit organizations that specialize in credit issues?


Financexaminer@real estate investor dot com


Real Estate Investor · Ellicott City, Maryland


Originally posted by Bill Gulley:
Jason, not disagreeing with you at all, but it sounds awfully strange that an attorney can't represent someone in a contratual obligation. They do so in bankruptcy for all or part for the forgiveness of debt.
You have pointed out that GA is different, but I just wonder how that ever got past lawmakers in the state knowing many were probably attorneys. And what about non-profit organizations that specialize in credit issues?

Bill -

You're absolutely correct, and I should have added more detail around what I was saying; as I said it above, it was misleading/incorrect (I can admit when I'm wrong :)...

According to the Georgia Residential Mortgage Act (Article 13), attorneys are exempted from having to be licensed under the condition that they are not compensated by the lender or a mortgage broker for their services. While this means that technically the attorney is allowed to negotiate on behalf of the seller, the attorney would either need to be compensated by the seller, the buyer, the agent or forgo compensation.

Sellers rarely have money to spend on their short sale, and in a typical short sale negotiation (in other states), the negotiator is often paid directly by the lender from the proceeds of the sale. Sometimes buyers or agents will pay the negotiator, but if the money is coming out of a buyer or agent's pocket, rarely do they want to pay the high fees an attorney charges, so that generally won't work either.

So, again, you're correct that a licensed attorney can legally negotiate loans in Georgia, but from a practical standpoint of how short sales typically work (and how negotiators typically get paid), most attorneys won't touch short sales in Georgia as there is no practical way they'll get paid a reasonable fee for the work.

Here is part of the regulation that contains the exemption list (see 7-1-1001(a)(5) for the attorney exemption and stipulations):

http://dbf.georgia.gov/vgn/images/portal/cit_1210/44/5/143622413GRMACodeSections_ver7-1-2011.pdf

Non-profits -- and lots of other people/situations -- are in the exemption list as well, though none of the exemptions provide a good method for investors to negotiate their short sales.


Small_lishproplogoJ Scott, Lish Properties, LLC
E-Mail: [email protected]
Telephone: 770-906-6358
Website: http://www.123flip.com
CHECK OUT MY BIGGERPOCKETS BOOKS: http://www.biggerpockets.com/flippingbook


Real Estate Investor · Springfield, Missouri


Thanks for the clarification, they are from the federal side, kinda what I thought. I leave out details all the time, can't cover everyting about everything in a forum!


Financexaminer@real estate investor dot com




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