All Forum Posts by: Marc Freislinger

In my experience (which is >20 short sales in the last year) there are a lot of variables. It mostly depends on the bank, but also when the last BPO was, when the auction date is, how much the original loan was, etc. Do you know if it is a local or national bank? If you can afford to offer at the currently accepted price, you'll have your best shot at getting the property accepted, but it still isn't guaranteed. Even with a previously approved price, the banks will sometimes revalue the properties.

If you cannot offer the bank's price, one of two things will happen.

1. The bank will accept the offer if it is within a certain percentage of the BPO. 85% is pretty low, so I bet you'll be at number 2
2. The bank will revalue the property. This could be good or bad, depending on your market. Here it is usually bad. This is where JScott's awesome post about Controlling Appraisals comes in handy.

I would request an inspection period if you plan to get an inspection. If you don't, or it's a slam dunk deal with plenty of room, it doesn't matter much. I like to reduce the inspection, though, to show that we can move things along. If the home is occupied, you will need to work with the homeowner, but you can use their agent to help facilitate that.

@Account Closed has it right. We have a few different contractors. Some we pay weekly, some only at the end of the project. However, you'll never want to pay a contractor for work not done. You'll always want to hold enough back that you can pay someone else to finish the job if your contractor decides to get up and walk away.

And we always buy the majority of our own materials. You can negotiate discounts with the places you shop, and it's easier to control your expenses. Some contractors will even mark up materials and/or charge you for going to get them.

Kirsten,

When selling a home, I have not noticed appraisers paying any attention to the condition of sale. We had a major issue selling a house a couple years ago for this very reason. The appraiser used ALL REO and short sale comps for our gorgeous remodeled sale. This is a large part of the reason we meet with them. We can give them a list of regular sale comps, and/or explain the deficiencies in the short sale and REO comps. The appraisal does allow for a "condition" value adjustment, so we try to utilize that.

Short sale appraisers (from what I've been told) are now only allowed to compare against regular sales. This means that when you're buying a short sale, they are valuing it against your competitors sales. Without meeting the appraiser and discussing the condition of your property and all of the comps it is absolutely impossible to get a good deal on a short sale any more.

Hello Troy,

Here is the order my crews prefer to do the work:

1. Demo - 1 or 2 days
2. Framing - 1 to 3 days
3. Mechanicals (Electric, plumbing, HVAC) - 2 to 3 days
4. Drywall - 3 to 5 days
5. Trim and Doors - 1 to 2 days
6. Paint - 1 to 2 days
7. Cabinets - 1 day (order far enough in advance)
8. Flooring - 2-4 days
9. Counters - 1 day (order when the cabinets are installed)
10. Fixtures (Fans, faucets, etc) - 1 to 2 days
    
11. Cleaning and staging - 1 day

Some touch up paint is needed at the end, but it easier for them to spray the home when there's nothing to worry about getting paint on (no cabinets or flooring). We generally do landscaping after flooring (as the flooring guys and painters will mess up the landscape dumping their buckets), unless we need to grow grass or something that will take a few weeks, in which case the landscaping is done first thing.

To answer your actual questions: If you could do number one, I don't see any reason why you can't do number 2. Birdogging requires finding the properties and turning them over to an investor. It sounds like you want to do the same thing in number 2, but you would take title first.

I would be concerned about getting seller's to accept your third-party approval contingency, but I suppose it depends on how the market looks in your area. Most sellers here wouldn't mess with that. What steps could you take to avoid that contingency?

Finding a broker to work with should be easy if you can speak to them in a way that shows them you understand what you're doing and that you intend to close deals. You will lose them quickly, however, if you start backing out of contracts.

If you do use a broker to submit offers, and you sign a buyers-agent agreement, then they have a fiduciary duty to you. If they go around you, and take a deal you want to offer on to another investor, you'd have solid grounds for a lawsuit.

@Ted Schmidt - How many calls do you normally get from your mailings? I've done a few mailings, and maybe I'm doing something wrong, but I've never had so many calls that I'd want to hire someone else to field them.

For a seller, this is a very personal conversation. One hint that your phone center is on a script and your seller is gone. Your phone center will not be able to make snap decisions or educated guesses. There are certain parts of this business that I think are very difficult to trust others with, and this would be one. It is your business, and nobody will work as hard to close a deal as you will.

I am not a lawyer.

I would imagine that you would find yourself in more trouble by creating a different lease or different rules for this family over any other. If you have concerns that a prospective tenant would disrupt the peaceful enjoyment of the downstairs unit, I would think that would be a valid reason to deny the application.

Depends how much research you want to do on the property. If it is listed, or has been listed, on the mls, you should be able to see some photos and get a good idea of the rehab needed. Or if you normally do full remodels, you just budget for a full remodel.

I'm glad you got this all worked out Casey S. As mentioned earlier in this thread, self help evictions are generally a terrible idea. We always had the best luck getting rid of squatters by doing frequent checks of our vacant units, and making sure all the neighbors had our contact information. When we managed to make it to a property shortly after the squatter entered, it was fairly straightforward to have the cops remove them.

Of course, like MikeOH used to say, when performing inspections on vacant units in these neighborhoods, it's best to protect yourself.

Paypal has integrations that allow you to collect rent through their system. They are fairly easy to set up, but it costs a percentage of each sale. This can be passed along as a "convenience fee." This is how we set ours up. Your clients can also set it up to auto-debit monthly, so they do not have to think about it.