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proudpreemieparents · Joined: 12 Jan 2006 Posts: 4

I am a real estate professional in NJ. I have a client with a home for sale that is in foreclosure. The client has a first mortgage with Indymac for $200,000. The client also has a second mortgage for $25,000 with Indymac. We received an offer for $190,000. Can anyone tell me the best way to proceed with this. I would prefer someone who has actually been on the seller side of short sale and if possible dealt with Indymac but all answers will be appreciated. Thanks in advance for your professional opinions.Just a quick update. I talked to Indymac and this is how they work. They are sending the borrower (my seller) a lending kit. It takes 3 to 5 days to receive. Once we submit the offer, it takes 10 days for them to approve or disprove of it. Sounds simple so far. All other answers are welcome. I'll keep this open and update it as the process continues as a reference for anyone else.

glenn0777 · Joined: 19 Feb 2007 Posts: 5

First of all I would ask the agent working with the buyer for their "highest and best offer"-That's a signal that you need the best offer up front as the buyer and the bank are going to have to decide if this will work and negotiating while it happens isn't as common! (p.s. they may try to negotiate your commission!) then present the offer! I'm confused about why you are asking the question? They (seller) will either take it or not! If they take it it may have some financial impact from an IRS standpoint so suggest they consult the CPA or CFP while they are at it. If the lender accepts the plan that is when you will need some CPA advice and perhaps a visit with an IRS person. The IRS will want to see the same package that you presented to the bank. Including the hardship letter, that you used to get the lender to agree to the shortsale in the first place. Good luck and look for some more classes on how to handle this. It never hurts to take as many as you can especially those with scenarios and experiences! Best of luck

Jocelyn · Joined: 23 Jan 2007 Posts: 6

Is the home in pre-forclosure or foreclosure? Have they been accepted into the short sale program with the lender? If not, then the first item of business is submit the necessary package to get accepted into the short sale program in order to buy some time before foreclosure. (My company www.myopentoclose.com can do this for you BTW.) You are actually fortunate the first and second lien are with the same lender. This will be easier for you and your client. Once they have been accepted, you will need to submit the offer to the bank. Most likely, they will write off the second lien and apply the 190k to the remainder of the first lien of 200k. Lenders typically take anywhere from 75-85% of the the payoff balance, so you are in good shape. Let me know if you have any more questions!

lovelylj · Joined: 01 Oct 2005 Posts: 6

Short sales are very dangerous. You need to run a credit check to see all the debts, check all records as if you were doing a title search, have the owner of the property talk straight with their mortgage company (ask for the mitigation department and do not accept anyone else) Only the bank can forgive the loan and pay your commission. If you were to take that offer your client would be in alot of trouble, probably would not get through closing, you would not get paid nor your broker and if it gets to foreclosure they will have credit problems for years to come. There is no usual way of doing things with short sales so this reply is not a complete answer to your question. Make sure your broker knows what is happening. If this is truely a short sale they need to approve the listing in the first place. Hope this helps.

KeepOnTrucking · Joined: 02 Jun 2005 Posts: 5

I have not worked with Indymac before but have been on the selling side of many short sales. The seller will fill out the short sale package with financials and hardship letter and return to lender. You will need a letter from the seller allowing the lender to release information to you. You will then send in the signed offer contingent on bank approval. They will send someone out to the property to do a BPO and then let you know if the offer is good or if you need to ask for more. It could take a while to close a short sale so let the purchaser know to be patient.