All Forum Posts by: Robert MacKinnon

It goes without saying that any time money is involved, scam artist are not far away. There is enough money available in these deals to do things correctly.

The potential for scams does highlight the title underwriters concerns. Many underwriters will not do these transactions out of fear that it is a scam. But we will close these if disclosures are properly made, and we detect no hanky-panky (Arms Length).

Lastly, BPO prices are based on similarly distressed property. AND then the Short Sale lender takes a discount. Re-sales do not involve distressed sellers and less of a discount. Price variations are explainable and reasonable.

Has anyone seen what these deals go for at auction? Not pretty.

For most otherwise qualified Fannie Mae borrowers, there is no seasoning, FHA, always. However, some lenders have an internal policy, no options!, no land trusts!

But I have another choice that is working, email me for details

Mitch,
Tell me more about equitable interest, I might know that as a different term.

Are you just saying that to set me up? If so I accept, WE DO! Bring your land trusts!!!

Even if "ShiMere, HSAOA" gets by the loss mit dept., better have a cash buyer on the other end because the buyer's lender will require the buyer to bring the assignment fee in addition to the traditional cash to close. Just a thought.

More Pros:

With the Option Contract:

1) More flexibility if property cannot be re-sold for a high enough price. You can just surrender option since there is no recorded change in title.

2) Heightened disclosure to end-buyer lender in title commitment which denotes speculative nature of transaction.

3) Available to use in any state.

With the Land Contract:

1) Name of seller on Real Estate contract matches Title Commitment.

2) Name of owner on Real Estate contract matches name on Appraisal.

Assume Short Sale. I want to make a spead. What is the best way to get that spead?

I have only seen this work as a double close, i.e. A to B; B to C, when C was a cash / hard money buyer.

For the Short Sale Double Closing
A to B; B to C

Pros:
If you choose the Land Trust, you will have the added advantage of seasoning to allow the end buyer to possibly qualify for FHA financing (The New Sub-Prime).

If you choose the Option Contract, you have the flexibility to unravel the transaction without a mess if you are unsuccessful in flipping.

More Pros and Cons to follow

Todd,

If you are new in this arena, sub out the short sale negotiation. Also, choose whether you are in the land trust camp or option contact. The pros and cons of each will be a future thread of mine. Either way, you are going to have an A to B, B to C situation.

See my "Short Sale Double Closing" thread.

I think you should get a coach to assist in the beginning. It will save you trouble, and probably money.

Thanks Dave!

You wrote:

However, I have issue with one part of your post: It will not materially deter acceptance in most cases. It is my opinion that this would deter acceptance in many cases.

Short answer: If it deters, don't do the deal. In practice, it does not deter the acceptence any more often than usual. Lenders understand what it takes to unload these properties. They accept a price, say 82%, of their BPO. Have you seen the alternatives. Has anyone offered you a bulk deal discount of 60% of BPO.

Back to the original point, we are closing deals everyday, only if disclosures are made.