Fighting Fair - Foreclosure Requirements Take Toll on Short Sales
Short sale investor are increasingly confronted with the prospect of losing out on a short sale deals as sellers seek to maximize the time they are able to live in a home for "free." A plethora of informational items are advising sellers to fight foreclosure and use stall tactics including entertaining multiple short sale offers and fighting foreclosure technicalities.
Learn how to identify stalling tactics and avoid wasting time on sellers playing the waiting game by understanding the basics of foreclosure requirements and delay techniques.
Foreclosure Requirements
1. Notice of Default - must contain information on money owed and time allotted for payment.
2. Recording of Notice of Default
3. Notice of Property Sales Date
4. Notification of Redemption Period
5. Notification of Foreclosure Commencement
6. Publication of Intended Foreclosure in public forum/legal notices.
Each of these may be governed by specific state requirements but should provide a general overview of the major steps. If any of the above are not specified or fail to conform to time or other legal requirements the current homeowner has the right to petition or file a complaint, effectively extending the time period to comply.
Short Sale Steps
Short sale investors may be able to spot potential delay tactics merely by asking if the seller is entertaining other offers; be cautious when working with a seller that seems minimally concerned with the details and overly concerned with obtaining a written offer of any type. While it could simply be an indication of a motivated seller, it may also be a play designed to keep the stream of offers rolling in while they are busy at work elsewhere.
Some short sale investors have the opportunity to actually review paperwork held by the seller. If you are fortunate enough to do so, keep an eye out for glaring inconsistencies which could trigger a protracted dispute. The last thing you need to become involved with is an extended closing or convoluted scheme designed to keep the seller in a home rent free while your time and money is tied up with a trip to nowhere.
Learn how to qualify and quantify your positions. Just like any good investor, short sales should have a time and profit potential in mind prior to actually making an offer. Use deadlines and escapes clauses to your benefit in order to maximize returns and minimize headaches. Sweeten the pot by offering a few hundred dollar reward for a quick closing or negotiate other items important to the seller and/or bank to get the deal done in a timely manner. Don't be afraid to think out of the box but avoid unnecessary complications that could become a stumbling block in their own right.
Comments (4)Subscribe to CommentsComment