High value short sale fell in my lap, now what

[Bill Wilson]

So I have been studying short sales as much as possible and I have an area where I want to focus in but I didn't think my first possible deal would be at this level. I guess I am a bit intimidated and I am looking for advise so I don't screw it up. Here's the deal:

I got a referral for a 40 ranch in ski country the owner owes $1mm and is in default. $1mm is ballpark of the value. There is a similar property listed for $1.15mm but has been on the market for over 6 months so its likely too high and they are fishing. (Comps are tough to find in the mountains.) Anyway, it leads me to believe that the referred home would be a short sale by the time all the transaction fees got paid. It is not listed and I would need to resell it in an A-B B-C transaction. I have a funder, a title co, and a negotiator lined up since I've been looking at getting into SS anyway. I need to line up a realtor or an RE attorney still.
I know short sales are complicated but I would like to be able to help these people out. I feel like there is room on this property to pay every one on the team, with a little left over because the market in the mountains isn't as hot as the Denver metro. So my feeling is the bank may be more flexible to avoid having a high dollar property sitting on the market for months. If I can negotiate the right price, I think it would move though.

What do you think, should I go for it, or run like hell? Any advice would be appreciated!

Thanks,
Bill

[J Scott]

I would highly recommend NOT trying to wholesale short sales these days. You will be required to sign an affidavit at closing indicating that you know of no transactions or agreements currently relating to the property that haven't been disclosed to the lender. If you have an end-buyer lined up already, there IS an agreement and your signing that affidavit would constitute fraud.

Not to mention, the lender will likely require the property to be listed by an agent, and the agent is already required to sign the affidavit. If the agent knows about the end-buyer, the agent is committing fraud as well, and putting his/her career on the line.

I'm not an attorney, but that's my advice...