How do I "wholesale" a "short-sale"?

Question

I found a property that's a short-sale. Is it possible to write-up a contract with the bank and wholesale it to a cash-buyer? If so, what's the process?

Thanks much!

Josh

Wayne Brooks · Answer

Most likely, you won't.  First, the bank will require proof showing the buyer on the contract has the ability to buy.  Secondly, it's highly unlikely the bank would agree to a price low enough for you to wholesale to an investor at a discount, as the bank will do a BPO and is looking for close to market value.  Before that, the listing agent will likely be on the lookout for some yahoo looking to wholesale, with no intention or ability to buy it themselves.  The last thing they need is to waste 3 months on someone who can't buy, and then they don't have time to go thru it again before the foreclosure.

John Mathewson · Answer

I agree with @Nick Colamarino your only option would be to double close it but even then it is pretty risky. There are some very very strict rules when it comes to short sales depending on the seller you could be liable for the purchase of the house it's not just as easy as backing out and them keeping your earnest money. Banks can get pretty ugly about it although it may be rare it is worth keeping in mind and learning more about. This was something I was not aware of when I started.

Nick C. · Answer

You won't be able to assign it if that's what your asking. You will have to close on it first and resell it. You could possibly double close on it, but most short sales have deed restrictions these days preventing the resale of the property for at least 30 days and sometimes as much as 120 days. If this is the case it will be in the short sale approval letter and you will need to line up financing.

How do I "wholesale" a "short-sale"?

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