All Forum Posts by: Sean Dougherty

Hello all. So I am trying out this preforclosure venture. Done a lot of research. Found all the listings in my area and have written each of them. Here is the first letter I wrote. I got about 5% response rate so far after 7 days.

attn: OWNERS NAME OWNERS ADDRESS PROPERY LOCATION

Dear ________________

Hello, my name is --------------. I am a local resident here in ----------- for the last decade. I am an honest, private, small time, local investor. I am not a real-estate agent or with a large company. I am contacting you because I have interest in purchasing your home located at “---------------.” Through county records I was able to see that your home may be at risk of being repossessed or auctioned. Please forgive me if this is not the case or if the default has already been resolved. I am not fully aware of your situation. But I wanted to simply let you know that I am interested in purchasing your home. I offer all cash, simple, quick, efficient transactions that could relieve what debt you may owe and also avoid forclosure. If you have any interest or would just like to talk over details please feel free to respond. I am happy to answer any questions. I would only offer a solution that would be beneficial for both of us. I am not a scammer.

Disregard this letter if it is not applicable or you have no interest. Please forgive me if this letter is at all invasive or insensitive. I understand you may be in a difficult situation.

Aloha and good luck. Sincerely,_____________  NAME, PHN # AND EMAIL ADDRESS

I am working with those who have responded but wanted to continue to contact those who have not. Here is the second letter I have drafted but not sent yet.

OWNERS NAME ADDRESS & PROPERTY LOCTION

Dear Mr ________

Hello, I had sent you a letter a week or so ago in regards to my interest in your home. I thought I would follow up with another letter. I can imagine that being faced with possibility of forclosure is a difficult situation to be in. I’m sorry. I am respectful of your privacy but I simply want to express my interest and provide you with some options. Please give me a few minutes of your time.

I am an honest local investor and again I am very respectful of others and their hardships. I would not pressure you on any matter or scam you into any transaction. If anything I would just like to share with you some of my knowledge in regards to the benefits of avoiding the forclosure of your home.

Obviously the ideal solution is for you to cure the default and keep your home. Depending on your situation I may also be able to point you in that direction. Yet if that is not possible, your next best option is to sell your home before it is repossessed.

Very briefly let me explain the advantages of selling your home before it is forclosed:

-By selling, your lender usually forgives your entire debt and back payments, regardless of what home sells for.

-Only minimal damage to your credit occurs because lender agrees to a settlement.

-Bank or buyer may even offer you “moving funds” and you can walk away debt free with money in your pocket for a fresh start.

- Whereas if your home is forclosed there will be a default judgement against you for the full amount owed. That debt will follow you until it is repayed and your credit will be severely damaged.

Although each individual case may differ, these are general guidelines. Selling a home before it is lost to forclousre is a no brainer. I can offer all cash transactions and close deals quickly and efficiently. Please give me a call, even if it is just to talk and get more information. And again please forgive any invasiveness or insensitivity on my part. I hope my offer can benefit you, if not, I completely understand and wish you good luck with whatever route you may take.

Sincerely,------------    NAME AND PHN NUMBER AND EMAIL ADDRESS

Any opinions or suggestions to improve? Too long? Too informative? misleading? Thanks so much in advance.

I have located a distressed homeowner who is willing to shortsale his preforclosed home to me. He had no plans to list his home through the MLS. He lost his job in January and it seems he will qualify for a shortsale with his lender.

Now I am trying to decide if it is necessary to bring a realtor in to represent me to the lender.

Would the Bank rather deal with a professional than a private buyer directly?

Would I be able to offer less by cutting out realtor and their fees?

And most importantly: A shortsale specialist told me that banks will ONLY approve a shortsale if it has been listed on the MLS through a realtor. Is this accurate?

Thanks in advance for the help. :)

Thanks so for that information. I will continue my research. 

I am an investor just starting to get into the market of purchasing pre forclosed homes. I just wanted to get a few things clarified before I start approaching or sending letters out to distressed home owners. I have a few questions here and will list them all in one post instead of separate ones. Please give answer to any or all of them. Thanks a lot,

Question #1: The reason to purchase a home in default is to make a profit by getting the home at some what less than market value. I am offering the current owner cash and a chance to walk away with little damage to their credit and an option to not lose the home to forclosure and get NOTHING in return. But why would the home owner consider selling to me when they could do a shortsale with their bank and get closer to market value for their home? What am I offering that would not also be available doing a shortsale through the MLS?

Question #2: If I were to make a deal with a distressed homeowner would all transactions be identical to a short sale? Meaning would we need to contact the lender, get the price approved? Would lender order an appraisal or BPO to approve price? Would it take the same amount of time as a standard short sale through MLS?

Question #3: Many homes in preforclosure I am looking at, the owner owes more than the home is worth. In standard short sales the bank forgives the difference. If an owner owes $400,000 on a home that is worth $250,000 would a bank ever accept an offer $230,000? Or should I be searching more for homes where owner actually has some equity?

I am an investor just starting to get into the market of purchasing pre forclosed homes. I just wanted to get a few things clarified before I start approaching or sending letters out to distressed home owners. I have a few questions here and will list them all in one post instead of separate ones. Please give answer to any or all of them. Thanks a lot,

Question #1: The reason to purchase a home in default is to make a profit by getting the home at some what less than market value. I am offering the current owner cash and a chance to walk away with little damage to their credit and an option to not lose the home to forclosure and get NOTHING in return. But why would the home owner consider selling to me when they could do a shortsale with their bank and get closer to market value for their home? What am I offering that would not also be available doing a shortsale through the MLS?

Question #2: If I were to make a deal with a distressed homeowner would all transactions be identical to a short sale? Meaning would we need to contact the lender, get the price approved? Would lender order an appraisal or BPO to approve price? Would it take the same amount of time as a standard short sale through MLS?

Question #3: Many homes in preforclosure I am looking at, the owner owes more than the home is worth. In standard short sales the bank forgives the difference. If an owner owes $400,000 on a home that is worth $250,000 would a bank ever accept an offer $230,000? Or should I be searching more for homes where owner actually has some equity?

ON 10/30 I made a full priced cash offer on a pre approved short sale. The listing agent has assured me that as of now mine is the only offer that has been submitted to the bank. She was confident that deal could be closed in less than a month. Now a few other issues have come up. I will list them here and ask for any advice concerning any or all of them.

1) Listing agents said we were only dealing with one bank in this transaction, but after some more research it seems that Fannie mae is also involved as an investor. Supposedly the bank had approved the previous offer but the buyer walked before it could be approved by the investor. So any offer would need the approval of bank and fannie mae? How likely is it that Fannie mae will approve price if the bank already has?

2) If the bank has pre-approved this price just 2 months ago, what is a reasonable estimate of how long it will take for the bank and the investor to accept my offer? And is it possible they will not accept it even though same priced offer was approved by bank 2 months earlier?

3) Now I come to know that this home has been scheduled for forclosure on 11/22. Listing agent says she is confident deal will close before then. And if not the bank will delay forclosure date to give us time to close. Is this accurate? Is there any way to assure it will not be forclosed during escrow?

4) Last question is. Listing agent says she is confident offer will be accepted within a week, It has been 9 days. Forclosure date is 12 days away. What are the chances of offer being accepted opening escrow and closing deal before then? Listing agent was confident it could happen. Please give your opinion. I am purchasing home in Vancouver Washington. Bank is Chase and investor is Fannie mea. Thanks so much for your help.