Welcome to this week’s edition of the Pre-foreclosure Daily Grind! This edition will discuss a change at Real Time Resolution, a debt collection company that works 2nd mortgages for EMC and American Home Mortgage. We’ll also go over the importance of pre-screening buyers, ESPECIALLY when it comes to short sales.

But first, we will address the change coming to Real Time Resolution. They have recently changed their approval process. The negotiators working the files will now need to provide additional internal information regarding the loan. This enables the investor and Real Time management to clearly see what they’re losing, what they’re gaining, and whether or not it would make sense to accept the current offer. In previous instances, Real Time would primarily look at what they were getting and make a decision based on what percentage of the loan principal they were receiving. Now, management requires the negotiators closely evaluate the seller’s financial situation and base their decision from those findings. This is not anything we haven’t seen before when it comes to the majority of lenders out there. However, this IS something that is new with Real Time Resolution. Therefore, be prepared for the process with them to take a bit longer than previous deals, and be prepared to come up with at LEAST 10% of the loan principal in order to receive approval.

Our second tip for this week is something we’ve covered in the past. However, it is something that will always remain a crucial part of every short sale. That is, pre-screening your buyers. The reason we are discussing this topic in this issue is because we have had yet another property this week in which the lender has provided us with written approval that has covered over 2 months…and the buyer needs more time. Now, you might have listings in which some other extenuating circumstances come up, that precipitate taking a certain offer. For example, it may be the only offer that has come in over the last several months. Perhaps comps may require you to list a property higher than you’d like which limits the offers coming in, the condition of the property, etc, etc. With that said, know that you WILL face difficulties in the settlement process. Know that you may not even get enough time from the lender to close if you take on a buyer that will need to stretch quite a bit to be able to qualify and actually CLOSE on the property. A perfect example that we frequently experience in Connecticut is when an FHA or 203k buyer comes in wanting to purchase a home that needs a lot of work. If any of you have encountered this type of situation, you already know what you will face. A scenario in which worst case: the buyer won’t qualify at all, and best case: it will take a long time for them to close; perhaps more time than the lender is willing to spend.

Enjoy this week’s Pre-Foreclosure Daily Grind tip of the week, and have a great and profitable week!

Welcome to this week’s edition of the Pre-foreclosure Daily Grind! In this edition we discuss a couple of great tips with you! First, we’ll cover a deal we’ve been working on recently, and how we’ve hit a roadblock regarding getting a foreclosure postponed. We will cover what you NEED to tell your clients with regards to how postponing foreclosures works. Second, we’ll talk about the basis on which 2nd mortgages often make the absurd requests they do which helps us all understand such situations.

Many of us have likely experienced a scenario in which we get about 80% of the way through the short sale process, only to have the lender foreclose and take the property right out from under us. This can be very frustrating! We ourselves have had THREE like this in the last 2 weeks alone. So, for those of you who have faced this also, here are a couple of things to keep in mind. First, if you’re working on a property in which the loan is over 12 months delinquent, it becomes less and less likely that the lender and investor (remember, this is the entity that owns the mortgage note) will agree to postpone the short sale. Therefore, as more time goes on, expect that you’ll need a higher offer or larger cash contribution from the sellers in order to get these postponements through. Also make sure to prep the sellers accordingly. Next, keep in mind that when you ARE working on a loan that is over a year delinquent, that the investor will want more money out of the deal to make it worth their while. Additionally, the situation will demand that ALL parties approve in writing BEFORE the foreclosure date in order to postpone the foreclosure.

For example: if it will take 10 business days for all parties to approve the offer, and you’ve only got 7 business days until the foreclosure, then it’s likely you’ll be hearing from the negotiator that they have to close the file out. We all know that it will be headed for REO land. In a situation like this, the only way they may CONSIDER to speed up this approval process is if they get more money out of the deal. Perhaps such money can come from the seller or maybe from the buyer. Thus, make sure to prep all parties accordingly for this, so that they know what to expect. As we all know, expectations are a HUGE part of our business, and are the difference between closing deals and not closing them! In our case it was a Freddie Mac backed loan, in which we had a full price offer in hand. Since there wasn’t enough time to approve it BEFORE the foreclosure, Freddie decided to foreclose anyway. Way to help the economy recover huh?!

This week we also had the privilege of dealing with yet another stubborn and completely unrealistic 2nd mortgage, USAA. This was setting up to be a nice, easy, 2- mortgage short sale, in which the 1st was set to be paid off in full. Despite paying off the 1st in its entirety, there was still a little over $24k left over for the 2nd mortgage! We went into it feeling very optimistic that the 2nd would take the $24k. Even if they wanted a prom note from the sellers, AT LEAST they would be perfectly ok with that sum at close. That way they could go ahead and approve the short sale, and get a nice chunk of their debt right away. However, that was not the case. USAA, for some reason, countered back and wanted…$58,000…dollars…at…closing! For me, there are never enough things I can say about a situation like this, and we’ve all been there, and laughed, maybe cried…and so I won’t waste any words on venting about it. But…what I will do is try to help all of you understand WHY some 2nd mortgages respond in this fashion.

There are 2 things to understand here. First, they are recourse loans, and so they know that even if the 1st mortgage forecloses and they get nothing in that sale, that they can still pursue the sellers legally to recover money. Second, the money they’ll get at close is really the only money they are fully guaranteed to get. The reason for this is because many homeowners simply file bankruptcy after the short sale is done or just simply DON’T pay whatever sum they’ve agreed to with the lender. Therefore, in many instances the 2nd mortgage gets what they get at closing. They lose a lot of their control in the situation because they have released their lien and secure position on title. Make sure to keep this in mind when dealing with them. As for the best way to counter this, just try to get as much money as you can, from each place you can, and present it as your counter offer to them. In most cases, their high counters are really a way for them to say, “We just want to make sure we’re pursuing all avenues to recover as much money as possible.”

Enjoy this week’s Pre-Foreclosure Daily Grind tip of the week, and have a great and profitable week!

On this week’s Preforeclosure Daily Grind “Tip of the Week” we uncover the facts behind whether or not processing short sales for Real Estate Investors is a waste of time or a profit center you need to add to your business! Listen in as we also cover, what your starting short sale offer, as an investor, should be and what it should not be, what most lenders require in their short sale packages that maybe a surprise to real estate investors, what to add into your short sale package that could ensure a BPO Agent does not screw you out of your hard earned money and more.

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This week’s Preforeclosure “Tip of the Week” is about how to train an Attorney or Title Company on how to properly conduct a short sale transaction. We also cover the latest and greatest backdoor move that Chase pulled and much more.  Watch more preforeclosure media at ShortSaleDailyNews.com or PreforeclosureDailyNews.com.

This week’s Preforeclosure “Tip of the Week” from PreforeclosureDailyGrind.com’s Bob Lachance and Chris “The Drummer” Bowes is about the new conditions of a Saxon Mortgage/Hillbridge Capital Group’s short sale approval letter. Will they take your commission away? How much will they allow a 2nd mortgage? Listen in for the answers and much more! Visit www.PreForeclosureDailyGrind.com and www.ShortSaleDailyNews.com for more short sale videos and articles. Please leave your comments and questions so we can address them on future videos!

This week’s Preforeclosure “Tip of the Week” from PreforeclosureDailyGrind.com’s Bob Lachance and Chris “The Drummer” Bowes is especially interesting because we got our hand slapped directly by Countrywide’s (BofA) Loss Mitigation Department about one of our prior videos! Make sure you listen in to the details! We also go over how Saxon Mortgage outsources there short sales and the process on how they do it and much more.  Visit www.PreForeclosureDailyGrind.com for more short sale videos or to ask questions visit www.AskBobLachance.com. Please leave your comments and questions so we can address them on future videos!

This week’s Preforeclosure “Tip of the Week” from PreforeclosureDailyGrind.com’s Bob Lachance and Chris “The Drummer” Bowes discuss the latest change from IndyMac Federal Bank and the best ways to keep a short sale buyer from walking! Listen in as we go over the most common buyer’s objections and how to counter them in order to keep these buyers on board! Visit www.PreForeclosureDailyGrind.com for more videos or to ask questions visit www.AskBobLachance.com. Please leave your comments and questions so we can address them on future videos!

This week’s Preforeclosure “Tip of the Week” from PreforeclosureDailyGrind.com’s Bob Lachance and Chris Bowes discuss how to be prepared and know how to answer any objection for any negotiation that you will encounter in a real estate short sale transaction.  This video dives into how to set up and answer your negotiations not only with any and all lenders, but also with the real estate agents, attorneys, title companies, the buyer, and even the seller.  They discuss the likelihood of encountering objections from each of these parties and what can be done to counter those objections.

They go over the importance of meeting and brainstorming with your team members (real estate agents, investors, etc) and why writing down objections you get on a daily basis will assist in prepping to negotiate, so that any objections or issues that arise can be met and dealt with accordingly right away. Visit www.PreForeclosureDailyGrind.com for more videos or to ask questions visit www.AskBobLachance.com.

In this week’s Pre-foreclosure “Tip of the Week” PreForeclosureDailyGrind.com’s we (Bob Lachance and Chris Bowes) discuss what sellers can expect after their short sale is completed and the buyer closes, and what type of action the lender can and will take, whether it be through a 1099 or a deficiency judgment.  We also discuss what sellers can do to respond to those actions, as they relive a recent closing of theirs and how it applied to their deal, and almost killed the whole thing!

The big takeaway in this video is the importance of setting these expectations with the sellers in particular as they answer the question, “Will the lender send me a 1099 or sue me for the balance?”  The bottom line is, make sure you answer these questions with each of your clients, as it can either make or break your deal!

Visit www.PreForeclosureDailyGrind.com for more videos or to ask questions visit www.AskBobLachance.com.