Turning a short sale into a 1st. position note acquisiton?

[James L.]

This is my first post on BP. I have used the search function and gone through the notes section and have yet to find answers relating to my current circumstance. If these questions have been asked before I apologize in advance. Any info or advice would be greatly appreciated.

I work with a group of investors, realtors and brokers in Central Fla that specialize in short sales. The business is good but we’d like to know if it’s plausible to turn some of these deals into 1st. position note acquisitions. Currently we are negotiating with dozens of banks and lenders to work out a short sale (on the underwater homeowner's behalf.) We have the full backing of the homeowner and many if not all would be more than willing to sign a Deed in lieu of foreclosure, as they just want to get out of the situation ASAP. So basically I want to find the current note holder and buy the first position note. Since they are already negotiating a short sale, which is a loss I figure it wouldn't be a far stretch for them to be willing to sell the note. Once the note has been secured the owner could sign a deed in lieu and walk away from the property. Also please be aware that all of these people's options have been exhausted and their rights to fight the process, fully understood. At this point they are going to A. complete a short sale or B. Lose the house and it becomes an REO.

I have a few questions:

How realistic is this goal and what should I be aware of in it’s pursuit?

I have read that you may not contact a homeowner, prior to note purchase? How true is this and are there anyways around this? Particular license? Lawyer on your behalf, etc.? Also what particular statutes govern promissory note purchases (I understand each state is different but a general idea would help, or if you know the FL statute numbers, even better)

I have also read that the original note contract may state that you cannot pursue a deed in lieu of foreclosure, but at this very moment our company is working with the lender to O.K. a short sale. What does this convey about the allowances of the original contract, does this mean it’s likely a DIL is possible?

Another way I have heard is companies buy a house in pre-foreclosure “subject to” underlying debt and then claim to acquire the 1st position note and at that point the homeowner can walk away (DIL) At that point the company owns the house free and clear. I assume they sell the property back to original homeowner at close to FMV and sell the new note created to an investor. Is this possible? Can a note holder legally forgive part of the debt owed, a charge down? Also if they have the cooperation of the homeowner why is it necessary to buy the property subject-to first in order to go after the note? Is having a contract on the property enough to show you have an interest in the property?