I received a call (lead) today from an individual who was in foreclosure and stopped the auction by filing chapter 7. I do not know how to go about with this lead. I believe I need to present my offer to the bank, but do I need to have my agent present the offer and am I going to need proof of funds for the offer. Is this a deal I can flip?? HELP
I'm guessing they're underwater on the property? If so, then yes you would be negotiating a short-sale with the bank. In those cases the banks will often put language in the purchase contract that effectively prohibits a traditional wholesale. To get around this, what some do is to contract the purchase in an LLC then sell the LLC to the end buyer for the amount of the wholesale fee.
If they have decent equity I believe you can negotiate the sale directly with the owner. As long as the bank gets what they're owed when it's all over I don't think they care one way or the other. Just make sure you know for sure how much the bank is owed now that there are foreclosure fees, etc. to deal with.
Thanks Jim. I didn't have a lengthy conversation with the seller yet. I am calling him tonight to complete my lead sheet, but I'm hoping he has some equity on the house (he's been there for 30 yrs!). I marketed to pre-foreclosures with a sale date 10 year back or more.
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