Hello Bigger Pockets,
I am looking for some guidance on navigating short sales. I am working on a deal where that owner of the property has passed away and has no family. The home is in bad shape probably worth about 50k as it sits. There is a mortgage for 80k. I was told if you can get a realtor to write a refusal to list letter. You could have a much easier time negotiating with the bank. I have never done a short sale and would appricaite all the help I can get.
Thank you all,
If there is no family/heirs, there is no one that can "sell" the property, short or otherwise, so that's a non starter. Never heard of a "refusal to list" to circumvent having it listed....sounds like guru crap.
I am with Wayne, I have never heard of a refusal to list letter being used in this way. If the owner dies and there in no heirs there is no short sale as the house would now belong to the bank. It would then eventually come on the market as a REO property. Banks don't like to negotiate sales of homes that they haven't sent out to be listed for sale yet.
I agree with the others as far as the refusal to list letter being bogus. Never heard of that in the last 15 years. Where I disagree is regarding the bank.
Banks are not anxious to add to their REO inventory. It costs them a lot to go through that process of finally selling the property. They have marketing fees, legal fees and still have commissions to pay in many cases.
Since this is not a big ticket item for the bank as far as houses prices go , I would definitely approach the bank and make an offer. They will be more motivated if you are making an all cash offer.
Having said that, you need to first decide what your exit strategy is. Buy/hold...flip..rehab...etc. Do not use Zillow to determine value. It is not accurate in many cases. Look at actual comps in the area.
Then do a detailed analysis to determine what your max purchase price is that will still make you a profit. That will tell you where your offer price needs to be.
I have had success in dealing directly with banks using this method prior to it being listed as REO.
I hope this helps. Good luck with this!
Talking to the bank is useless. The bank has no control at this point, as they don't own it, and there is no one with authority to sell. Nothing can happen, without some heir gaining authority to sell and willing to pursue a short sale, until the foreclosure auction. Buy it there, or wait for it to become listed as an REO.
There is a personal representative involved. They should be able to make he decision to sell it.
If the PR has the power, and is willing to pursue the short sale, then maybe you have a shot. I wouldn't bet on the PR being willing to do it. It will most likely be listed on the open market though.
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