What does a short sale negotiator do to earn a fee?
I'm looking at a couple of short sales. The listing agents have told me that both will involve the services of a short sale negotiator who charges a fee of $7,000 that is added into the offer price.
I understand that there is an art to convincing a seller and a bank to accept an offer that is below the outstanding debt on the property. I'm curious if there is anything more than just a whiz-bang set of negotiating skills that a short sale negotiator brings to the table.
For reference, one of the short sales I'm looking at an SFR that was originally listed at $96,000. The price is down to $87,000 after 2 successive price reductions over about 90 days. I believe that the outstanding debt on the property is roughly $65,000. The property needs about $35K in renovations and repairs. Based on recent neighborhood comps, I believe that if it is repaired it would sell around $90K. I'm willing to offer $23,000. I understand that my offer is a ridiculous number, but the $7,000 short sale negotiator fee brings my commitment up to at least $30,000 before I do the repairs. With repairs, I would be into the property for $65,000. After sales costs and contingencies, maybe I'd make $15,000 to $20,000 on the deal, which is a fair return for my risk. If I can get rid of that short sale fee, I get more room to negotiate.
I think I can do the negotiations on my own. Do I need the negotiator?