“Rapport” netted us a $7,400 short sale/loss mitigation fee on a Florida property
Rapport, rapport, rapport! “I saw your name on the coversheet, and thought, I’ve worked with this guy before!” Those were some of the first words that the new negotiator at GMAC said upon his phone call informing me he was now handling this file. And that was when I knew that this deal was going to happen, it was going to close.
The deal in question involved two mortgages, a tremendous amount of debt, and a fair market value that had dropped from over $400K down to the mid $200K’s. Both mortgages were staring at a big loss and buyers were not coming in droves. Because the deal quickly had to be converted to a retail short sale, we then had to not only find a buyer with a high enough offer, but also convince them to make their offer inclusive of extra funds to go to the 2nd mortgage, GMAC, which we ultimately needed to get this closed.
Those were the initial challenges.
Now down to the solutions. As I said, the property had two mortgages. The first was only allowing $1000 to the 2nd mortgage, and the 2nd mortgage wouldn’t cooperate unless they got $6000 at closing. So the first challenge was to meet that requirement. By working with the offer price and the buyer’s agent, I was able to get the buyer first to agree to pay the difference, by way of us negotiating seller’s concessions for the buyer. The next step was to get the 1st mortgage on board. At first they only agreed to half the seller concessions that the buyer would need to pay the 2nd, but I continued to push and got an approval for the full amount, and in turn the written short sale approval letter from them.
I then proceeded to attack the 2nd mortgage. Now that I could depend on the sum they required at closing (which, incidentally, they had already approved on a prior offer), I was not only able to tell them the 1st mortgage and buyer were on board to pay them, but also to remind them that they had already approved the amount I was proposing. And now for the icing on the cake – the negotiator at the 2nd mortgage was a rep that I had dealt with on a prior short sale and built a level of trust and rapport with. So I knew I had an ally that would help me in getting this deal done.
Through some more perseverance I got the 2nd mortgage on board to approve $6000 once again, and we were able to get the offer accepted. Once we got both lenders on board and approved, we now had to coordinate the closing and settlement phase of the process. At the last minute, the buyer’s agent came out and told us he was going to have to cover the balance of the sum that was to go to GMAC, since at the last minute the buyer claimed they forgot they were responsible for that. Once we got that sorted out, I then moved to get all the necessary paperwork to the title company. At the last minute, I also needed to get another extension (the 2nd) from ASC to make sure there was enough time to close, since the buyer’s lender was dragging their feet (no surprise!).
After all challenges were met, both preliminary ones and last minute ones; the buyer closed and a property that we had been working on for roughly 8 months finally disappeared from my pile. As for how we got paid on this one…we received $7,400 in short sale fees.
Take – Away
Always persevere when working on your short sales, especially those that have multiple mortgages or liens. They may seem like an insurmountable task at the outset, but if you keep pushing and don’t give up, you will be successful!
And always, always be professional and courteous when dealing with any and all negotiators that you face. You never know when you’ll see them again and they’ll be in the position to either make or break a deal for you. For more articles and videos with real-time updates on changes in the pre-foreclosure industry visit www.RealEstateBusinessMentors.com and if you would like to ask me a question visit www.AskBobLachance.com.
3 Responses
Leave a Reply
Was this just in Short sale fees for negotiating or did this include real estate commissions? I am working to form a loss mitigation company and have seen and used different techniques for negotiation fees. How do you state yours on the HUD if it is not a real estate commission?
Nicole,
I received my fees by getting paid a 1% negotiating fee from the real estate agents, a doc prep fee from the Lenders and $2500 from the seller.
Rather great post, genuinely enlightening information. Never ever thought I’d find the information I would like in this article. I’ve been looking all around the internet for some time now and was starting to get discouraged. Fortunately, I came across your website and acquired precisely what I was hunting for.