Problems With Foreclosures
- Date: 2007-12-11 - Word Count: 462
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Foreclosures are seldom ever a good experience to deal with. Though FHA loans don't cause problems too often, recurring problem seems to happen with conventional loans. Most of the time, the banks that deal with these loans choose not to discount the property very much, if at all. They often want to charge or will want to charge the BPO or the appraised value of the property.
This is referred to as a short sale. A short sale occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien that is secured to the property upon receipt of less money than is actually owed. For example, if the balance due on a mortgage is $150,000 but the property sells for $110,000, under a short sale, the lender would accept the $110,000 as a payoff of the loan.
If you are dealing with a situation that you feel is a short sale, you should consider doing some research before jumping on the offer. Talk in depth with your agent because he can determine who is on the title and if a foreclosure notice has been issued, and how much is owed to the lender. This will give you an idea as to the final price. Also take note if there is a second mortgage on the property.
Working past this is often times not much more than talking to the right person at the right time of the month. Bank manager's deal with these foreclosures on their books. And when too many of them are there, they pressure their employees to get them off the book. So, in essence, getting a few of these guys working for you is a good move. This way you do not have to feel like you are chasing only one person trying to get these closures.
On average, only about 35% of these are closed. Just complete the short sale package as the bank requires and send it in. You don't have to approach them about anything, and there are no fancy words to say...and just know there's very little you're gonna say to influence the sale.
With these considerations, all foreclosures have their own benefits and obstacles to work around. There are many different strategies to take when working with foreclosures and short sales. Be sure you do all the necessary research to accomplish what you are wanting. The payoff can be very profitable.
About the Author:
For additional information on real estate investing and the hot foreclosure market, I recommend joining Ron LeGrand's Millionaire Maker Newsletter The newsletter itself is loaded with great tips and resources, and he's usually giving away something free like a CD or something that generally has a lot of great information on it.
This is referred to as a short sale. A short sale occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien that is secured to the property upon receipt of less money than is actually owed. For example, if the balance due on a mortgage is $150,000 but the property sells for $110,000, under a short sale, the lender would accept the $110,000 as a payoff of the loan.
If you are dealing with a situation that you feel is a short sale, you should consider doing some research before jumping on the offer. Talk in depth with your agent because he can determine who is on the title and if a foreclosure notice has been issued, and how much is owed to the lender. This will give you an idea as to the final price. Also take note if there is a second mortgage on the property.
Working past this is often times not much more than talking to the right person at the right time of the month. Bank manager's deal with these foreclosures on their books. And when too many of them are there, they pressure their employees to get them off the book. So, in essence, getting a few of these guys working for you is a good move. This way you do not have to feel like you are chasing only one person trying to get these closures.
On average, only about 35% of these are closed. Just complete the short sale package as the bank requires and send it in. You don't have to approach them about anything, and there are no fancy words to say...and just know there's very little you're gonna say to influence the sale.
With these considerations, all foreclosures have their own benefits and obstacles to work around. There are many different strategies to take when working with foreclosures and short sales. Be sure you do all the necessary research to accomplish what you are wanting. The payoff can be very profitable.
About the Author:
For additional information on real estate investing and the hot foreclosure market, I recommend joining Ron LeGrand's Millionaire Maker Newsletter The newsletter itself is loaded with great tips and resources, and he's usually giving away something free like a CD or something that generally has a lot of great information on it.
Related Tags: real estate, real estate investor, seller financing, buyers market, lease purchase, proper training
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