Archive for April 2009

How to Get the Most Money By Remodeling to Sell, Buy, or Invest

April 26, 2009

Free Informational Seminar on Thursday May 7, 2009 from 6:30pm to 8:30pm.

Located at Pro Buidling Supply, Inc 7025 S Fulton St Suite #150  Centennial CO 80112.

A fast paced, fun informative evening covering everything including the Kitchen Sink.  Learn about some of the latest products and expert information on home improvement, energy audit, home fiancing, including special seller and buyer secrets, as well as investor programs – and more..

Experts Panel Includes:

Tom Higgins,  Co-chair of the Home Builder Association’s Remodeler Council. Topic: How to Hire Your Dream Remodeler

Nancy Kellogg,  Home Energy Auditor, who works with Xcel Energy on Energy Audits.  Topic: What is an Energy Audit’s Value to You

Other Expert Panelists Include: (Pat Argall)Loan officer,  (Darin Ray)Architect, (Robin Gaensslen)Interior Designer and More.

Also Door Prize: Energy Audit of your home. Valued at $100.

So Register for this free seminar.

To register – Click    Here.     or rsvpforinfo@gmail.com. Seating is limited.

 Invite your friends, co-workers and family members to join you at this seminar.

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Life of a Short sale offer

April 6, 2009

Thought this might be interesting. The next few post will detail the timeline of a short sale offer with a buyer I am currently working with. Come back and visit to see what happened.

Day 75. 04/23/09 told Jamie, nothing changed. Status quo, will call next week again reviewed details of past conversations to make sure we are on track, and nothing is being loss in the conversation process of what has happened to date.  As you can see we are approaching the 90 day mark of getting full approval with all involved.

Day 74  04/22/09 Wed: 9:30am LM for Bob, anything yet with Bank about official extension? Bob responded nothing yet.

Day 72 04/20/09 Mon; Told Jamie (buyer), Bob called. Waiting for official bank extension approval. Seller has to come up with $2,500 & pay Bank’s 2nd dot prior to closing. Seller will only pay $2,500 after buyer does inspection. On buyer side, want assurance of some sort that if seller obtains money to pay 2nd, that seller money will be used for paying the 2nd deed of trust. Bob understands and will figure something out, Bob also says yes, still can close by May 15, 2009

Day 69 04/17/09 Talked to Bob & then relayed info to Jamie. Still on hold, 2nd requires additional info and signatures from 2nd. Bob still confident will have closing by 5/15/09.

Day 62 04/10/09 Talked to Bob, confirmed recvd amend/extend for closing date and will get rest of the paperwork to me later.

Day 61 04/09/09 9:15am Talked to Jamie, am forwarding amend/extend for Jamie to sign. Please sign and return.  Jamie sends back signed amend/extend and then forwarded to bob, the listing agent.

Day 60 04/8/09 Bob calls and says will have amend/’extend to me today or tomorrow for the contract. 2nd dot required tax returns to verify seller’s finnacial info.  However seller’s tax return had errors so seller is correcting tax return errors and will have corrected tax return to 2nd dot by end of this week.  I convey this info to Jamie and also remind Jamie to check with lender to ensure the lender can move quickly once we have definite go ahead.  Told Jamie the possible pitfalls on the lending side that Jamie needs to be aware of. Reason we are still waiting is don’t want my buyer to spend any money uselessly, (inspection, appraisal)

Late evening 10pm receive email with amend/extend

Day 59 04/07/09 ttd Jamie status quo no change as of yet. Bob responded late this afternoon & I responded back with questions.

Bob, So should the buyer tell the loan company to be ready to close at the end of April, and also, will The foreclosing bank close on the last 3 business days. Some banks won’t do that.  And of course should we begin the inspection process. As of now we have never received in writing that the 1st or 2nd is agreeable to this offer. Let me know, Bill

Quoting Bob

Hi Bill, The 2nd has asked for 08 taxes from the seller. Those were just completed yesterday but there is a mistake on them. As soon as the seller fixes that, he can get the taxes to them and we will move forward. In the mean time, I have to get an extension from the first and they require an ammend/extend. I will be sending that your way. We should be able to close by the end of the month.  Thanks, Bob

Day 58  04/06/09 I ask Bob for update regarding the additional 4.8% the 2nd dot wants.

Day 53  04/01/09 Email received from Bob,

1.      2nd dot wants approximately 4.8% of the list price from the seller to satisfy the 2nd dot that is on the property.  If seller can come up with 4.8% then 2nd dot agrees to      contract offer and my buyer can then commence the necessary actions to close on the property.

2.      Right away I let the listing agent know, that my buyer will not pay anymore for this property and don’t expect any portion of it to come from the buyer. If they expect Jamie to give additional money to the 2nd dot, then Jamie will walk from the transaction. This is a few thousand dollars the seller has to come up with so the deal can be finalized.

3.      Bob, the listing agent says, he and the seller will go back to the 1st dot to see if anything can be negotiated with the 1st dot to satisfy the 2nd dot’s demand.  Seller does not have an additional 4.8% to give to 2nd dot to satisfy  2nd dot’s demand.  Note this may work out because both of seller’s loans are with the same bank.  Which is why I said earlier; this short sale property might work out even if it takes a bit of time.  We’ll see what Happens.

Day 52  03/31/09  Email sent to Bob, the listing agent; any news from the 2nd dot?, my buyer getting restless and may bail out on this contract if we don’t get some type of answer from the 2nd dept responsible for the 2nd dot.

Day 51  03/30/09 Jamie calls me, wants to see a few properties, Jamie concerned this may drag out longer then expected and what if 2nd dot doesn’t accept offer.

Day 45   03/24/09 I follow up with Bob to see if 2nd dot has responded to our offer.

Day 39   03/18/09 Talked with Bob, 1st has approved the counter offer signed by Jamie. Now Bob talks with Bank about the 2nd DOT on the property, so we need to Wait for 2nd dot’s response (same bank but different department has to give us an answer. Good news is a negotiator (asset manager is assigned to 2nd dot) Bob says perhaps 10 business days from today we’ll get response from 2nd Dot.

Day 38   3/17/09 I email Bob the listing agent, any word from the Bank on 1st Dot?

Day 30, 3/09/09 Bank responds 1st dot dept does not accept our offer, which is 4% below listing price. They will only accept full list price. After discussion with Jamie about market value of property ( which may be about 4% higher than market evaluation estimates), Jamie decides to offer full list price to bank. We sign counter offer prepared by listing agent, and it is forwarded to the bank.

Day 22  3/01/09 Jamie emails me, wants to see another property; then emails back and decides not to see it once I tell her we already saw it the first day we went out.

Day 19,  2/26/09 Email received from listing agent (Bob):

1.      Bob received the HUD-1 (this is a settlement statement for the bank to review and see what the bottom line number is to the bank with this particular offer. the work up is from the title company to include in the offer submission today.

2.      But it had a mistake on it. Bob will have a new HUD-1 in the morning and fax it to the bank as soon as he receives corrected HUD.  Bob will receive Corrected HUD tomorrow.

3.      Bob does not have a good idea on response or closing time for Jamie’s replacement property.

4.      Listing agent (Bob) says we have a negotiator. However, Bob cannot talk to him (the bank asset manager of this property, bank policy) until the asset manager has the file 30 days.

5.      So the earliest we will hear is March 10th whether or not the Bank (1st deed of trust [1st dot] accepted Jamie’s offer.) Bob has on his calendar to call the bank asset manager then. Hopefully my buyer can hang in there.  Note asset managers can have anywhere from 50 files (short sales) to 200 files at any given time in this type of housing market.

I send the following email to update Jamie:

As I said we can still look to see what comes up, and again if there is a property that seems more desirable, we can pursue other properties that show up.  For now though, here is what you do know for planning purposes.  Go ahead begin your process for finding a temporary residence until we close on your replacement property.

Figure minimally 2 months from the day you close on your property.  You will want to check with your loan officer to see how long it takes her to get your loan fully approved for a closing.  Some banks, yours included, can take up to 45 days from contract acceptance to closing date.

Best scenario (take with grain of salt)

The listing agent(Bob) gets a  yes response back from the negotiator on your replacement property on March 12th.  Negotiator say transaction shall close within 30 days of bank’s acceptance but cannot close on the last 4 business days of any month. This brings it to April 2, 2009 as the earliest possible closing date.

Day 18  2/25/09 I follow up with listing agent to verify the contract has been sent to the bank, and has the bank has assigned an asset manager to the property?, and if bank can give indication of response time and closing time for property. 

Day 17  2/24/09  Listing agent has forwarded the revised offer to the bank.

Day 16, 2/23/09  Seller signs the new contract today because listing agent not able to reach seller on 2/19/09. I receive revised contract signed by seller and forward it to Jamie

Day 12  2/19/09 Listing agent calls me in the morning, Bank’s response is they will not take any type of offer that is contingent upon the successful closing of a property. The offer must be contingency free, except for the inspection and appraisal..  I inform Jamie, we need to write the offer differently and have Jamie execute a new offer on the property. I will also write it in such a way as to protect Jamie’s financial investment as best as possible, so Jamie does not lose the earnest money or spend unnecessarily any appraisal or inspection cost.  Also inform Jamie, the listing agent is leaving town Friday Morning and if timing works out, Listing agent will forward new offer to bank prior to leaving the area.  Jamie and I meet late in the afternoon to review the contract, explain the nuances of this revised contract, have Jamie sign new offer along with all new disclosures and addendums;  then submit offer to listing agent prior to 7pm on 2/19/09.

Day 11   2/18/09 Spoke with Jamie, The seller is in agreement with Jamie’s offer. However the agent is talking with the bank about how they view a contingent offer (your house successfully closing) and if they will take a contingent offer.  If they don’t then we may have to write the offer in a different way. I will let Jamie know. [additional info: Jamie’s current home is under contract, all contingencies have been met and/or resolved, Jamie and I are just waiting for closing date to close on Jamie’s current home; which is scheduled to close well before Jamie’s offer on Jamie’s replacement property is scheduled to close].  I let Jamie know, the chance of a simultaneous closing is zero, in my experience.  Jamie needs to have a secondary plan for where Jamie will stay after the closing of Jamie’s current home.

Day 10  2/17/09 Informed Jamie, spoke with listing agent last 2 days. Seller is not in the area, Listing agent has not been able to connect with seller. Listing agent still trying to connect with agent. Seller must approve the offer before it can be submitted for bank approval (Department for 1st loan).

Day 8   2/15/09  Listing agent unable to open email attachment for Jamie’s offer, Sent offer again thru faxing.

Day 6   2/13/09. We write an offer.  I explain to Jamie the following points of why the offer is written the way it is, and Jamie agrees – signs the offer and I submit it to the other agent.    Here is the conversation and explanations to Jamie.

1.      Based on research and the market value analysis for the Sellers house. The value range is 3.6% to 18.16% lower than the seller’s asking price. 

2.      The property has been on the market for 59 days. This is relatively new, as far as bank is concerned, so they may not accept an offer below the list price.

3.      The property is not yet officially recorded as a short sale with the county.

4.      There are two loans attached to the property and fortunately the same bank holds the two loans. If it was two loans but held by different banks, I would not recommend submitting an offer.

5.      Jamie asked “should we submit and offer 4% below the seller’s asking price?”

6.      My response is “let’s submit it  8% below the seller’s asking price” (note we actually talked about prices in numbers, not percentages, however since this is a live transaction,  I need to protect the buyer and transaction for now)

7.      Keep in mind even if seller agrees to this offer, the offer still needs the banks’ approval. (both loan departments,  even though it is from the same bank have to approve this offer.)

8.      The offer is signed and submitted to the seller’s real estate agent.

Day 4   2/11/09 buyer Jamie decides she wants to put an offer in on one of the properties.

Day 2    2/9/09 Buyer jamie looks at 11 properties.

Day 1    2/8/09 Buyer Jamie looks at 9 properties