Learn How a Top Agent Closes Short Sales
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Transcript of Learn How a Top Agent Closes Short Sales
ATC Financial Short Sale Presentation
Short Sales Simplified for Realtors
www.aroundtheclockshortsales.com
To list your home visit Nick Gioia with Re/Max Sails at:
BaltimoreRealEstateSales.com
Short Sale Marketing Ideas
Social Media: Facebook, Twitter
Notice of Defaults (NOD List)
90-120 Days Late on Mortgage
Fail Loan Modifications, Pending Foreclosures
Wave Mailing
Mailers
http://www.printerbees.com/short-sale.html
Mailer Disclosure Statement
Loan Modification Leads
90% of all loan modifications end in failure
Great Short Sale Lead
Sample Mailer (Front)
MAY WE THROW YOU A LIFE LINE?
· IN A HARDSHIP SITUATION? · UNABLE TO MAKE YOUR MORTGAGE PAYMENTS? · FEARING FORECLOSURE AND SHORT ON EQUITY? · NEEDING TO SELL, BUT UNSURE OF YOUR
OPTIONS?
IS DOING A SHORT SALE YOUR BEST OPTION?
THEREISNOCOSTTOYOU,INCLUDINGCOMMISSIONFEES.WEARESHORTSALE
SPECIALISTSANDCANWORKWITHYOUANDYOURLENDERTOIDENTIFYYOURBEST
OPTIONS.MINIMIZEYOURCREDITDAMAGE.IN100%OFFORECLOSURESIN
MARYAND,THEBANKHASTHERIGHTTOPURSUEADEFICIENCYJUDGMENT.INA
SUCCESSFULSHORTSALE,ALENDERMAYWAIVETHEDEFICIENCYANDGIVEUPTHE
RIGHTTOPURSUEADEFICIENCYJUDGMENTAGAINSTTHEHOMEOWNER.
CALL TODAY. SIT BACK. RELAX. “WE GOT THIS”
Sample Mailer (Back)
2331 YORK ROAD, SUITE 304, TIMONIUM, MD 21093
SEAN M. DER
JAMES T. WEISKERGER
Loss Mitigation Specialists
OFFICE: 410-779-1000 CELL: 443-324-9475
[email protected] www.atclegal.com
ATC Legal is not associated with the government and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not change your loan.
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
Does Your Seller Qualify for a
Short Sale?
Sellers are behind on their mortgage and unable to pay their mortgage and keep up with their monthly household expenses. Hardships could be a result of loss or reduction of income, divorce, job relocation, etc…
Sellers are not behind on their mortgage but their monthly household expenses exceed their monthly income and they expect to fall behind in the near future.
Sellers are not behind on their mortgage but need to move due to a job relocation or other reasons such as retirement, health, disability, etc…
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
Who should negotiate your
short sale?
Third Party Company that…
Specifically focuses on all aspects of the short sale process.
Works with all banks not just selected banks
Has extensive short sale experience with all banks, liens, etc…
Clear understanding of the differences between foreclosures, loan modifications and short sales
Does NOT CHARGE ANY UPFRONT FEES to the seller
Has a strong support team of experienced case managers and client coordinators
Gathers all bank required documents PRIOR to contract
Submit Pre-Packages for preliminary approval
Experience in negotiating cash contributions, promissory notes and deficiency judgments along with other counter offer terms
Possess a Credit Service license from the State (DLLR)
Required in the State of Maryland when negotiating promissory notes and/or deficiency judgments.
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
What potential outcomes should I
expect from a Short Sale?
Every case is specific to the seller’s financial situation
Full Short Sale Lien Release
This release allows the short sale transaction to take place
Other Short Sale Approval Terms may apply based on the individuals financial position and the guidelines set forth by the bank/investor holding the loan
Cash Contribution may apply
Promissory Note
Deficiency Balance
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
What is a Cash Contribution?
The short sale lender and mortgage insurance company, if applicable, may require a cash contribution.
A cash contribution is when a lender requires the seller to bring funds to the table at closing in order to release the short sale.
WHY?
If the seller has sufficient assets or credit lines, banks may request it.
If the seller is not behind on the mortgage or their credit is excellent, banks may request it.
If the loan has mortgage insurance, the mortgage insurance carrier may demand a cash contribution, since the bank has filed a claim to the insurance company for past due payments.
This may be negotiated
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
What is a Promissory Note?
The short sale lender and mortgage insurance company, if applicable, may require a promissory note. A promissory note is when a lender requires the seller to sign
an agreement to make payments on a new note in order to release the short sale
WHY?
If the seller has sufficient assets or credit lines, banks may request it.
If the seller is not behind on the mortgage or their credit is excellent, banks may request it.
If the loan has mortgage insurance, the mortgage insurance carrier may demand a promissory note, since the bank has filed a claim to the insurance company for past due payments.
Typical terms of a promissory note is 20%-40% of the outstanding balance payable over 10 years, 0% interest.
This may be negotiated To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
What is a Deficiency Judgment?
The short sale lender and mortgage insurance company, if applicable, may issue a Deficiency Judgment.
A Deficiency Judgment is allowed by state law whereas the bank reserves the right to collect the unpaid balance of that is owed and what has been collected as a result of the short sale.
WHY?
If the seller has sufficient assets or credit lines, banks may request it.
If the seller is not behind on the mortgage or their credit is excellent, banks may request it.
If the loan has mortgage insurance, the mortgage insurance carrier may demand a deficiency judgment, since the bank has filed a claim to the insurance company for past due payments.
This may be negotiated To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
Who determines the terms of the short
sale, cash contributions, promissory
notes and deficiency judgments?
Most Short Sale Bank Negotiators follow guidelines in order to determine the terms of the short sale…
Real Estate Commissions
Settlement, Title, Legal and Process Fees
Appraisal Evaluation versus Buyer’s Offering Price
Required Minimum Net Value from the Short Sale needed by the bank/investor
Investors, Mortgage Insurance Carriers and Junior lien holders determine… Cash Contributions, Promissory Notes, Deficiency Judgments
This is usually performed after the Negotiator has approved the file base on the bank’s guidelines
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
What can be Negotiated?
EVERYTHING can be negotiated.
It is based on a variety of factors.
Seller’s level of Financial Hardship
Current Assets and Income
Seller’s credit score
Seller’s is behind or on-time with their payments
Bank’s level of urgency
Large banks tend to be more negotiable
Small banks, credit unions, hired-attorneys tend to be less
negotiable
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
Differences between Foreclosure and a
Short Sale
With a Short Sale…
Deficiency Judgment in many times may be waived
May affect your credit score by 50-80 points
May qualify to buy a new home within 3 years
Make sure you consult your tax advisor and credit specialist for details of the affects of a short sale
With a Foreclosure
Deficiency Judgment is automatic
May affect your credit score by 200-300 points
May not qualify to purchase a new home for 7-8 years
Make sure you consult your tax advisor and credit specialist for the details of the affects of a foreclosure
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
Why ATC? No Upfront Fees or charges to the Seller or Realtor
Fully Credit Service Licensed by the State of Maryland
Separation of Liability
Work with 20+ approved title companies to pull Owner’s Title Search / Prelim HUDs within 10 days of contract date.
Experience and Growth
We have over 300+ active short sales in negotiations and 250+ short sale listings
Growing 100+ new short sale listings and contracts every month
Gather all bank required documents. Every document faxed to the bank is VERIFIED 48 hours later by our client coordinators.
For many lenders, we submit the short sale pre-package BEFORE you even get a contract to obtain preliminary approval, BPO ordered, and negotiator assigned.
Negotiate all terms of the counter offers on behalf of the seller
Short Sale Lien Release
Minimize or eliminate Cash Contributions, Promissory Notes, and waive Deficiency Judgments (95% success rate subject to sellers’ and investors’ financial condition and guidelines respectively.
Typical counter offers obtain within 65 days from when short sale package has been submitted.
Weekly updates to listing agents, buyers agents and sellers if requested
Online Short Sale Database program to track all activity. Guest login access to Realtors
Short Sale Commander
Lenders that we have experienced
We have experience in negotiating 1-3 liens on a single
property
Bank of America, Countrywide
Wells Fargo, Wachovia
Citibank, CitiMortgage
Chase, GMAC, Suntrust
AHSMI, M&T, PNC, LBPS, GreenTree, Flagstar, BBT,
Credit Unions, EMC, MetLife, IndyMac, Ocwen,
NationStar, Saxon, HSBC, Aurora, Bogman, PHH, First
Horizon, Midland, Hamilton, Carrollton, ASC, Capital One,
Litton Loan, Huntington, BB&T, PNC
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
How do I get started?
Sign a short sale listing agreement with your Realtor
Upon receipt of the Short Sale listing, ATC will send out a Short Sale Seller’s Package to be completed. Our client coordinator will be in contact immediately to begin
gathering all the bank required documents to prepare for submission.
While we are collecting documents and processing preliminary approval, if applicable, your Realtor will be marketing your property to find a qualified buyer.
ATC case managers are here to answer any questions that you might have concerning the potential outcomes of the short sale.
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com
ATC Fee Disclosure Schedule
PROPERTY:
SELLER(s) NAME:
Our short sale negotiation service fees are subject to 3rd
party approval and each bank approve fees
differently. ATC may receive partial, all, or none of the fees listed below as a result of executing the
short sale on behalf of the seller.
THERE ARE NO FEES CHARGED TO THE SELLER.
A. Fees to be paid By Short Sale Lender(s) subject to 3rd
party approval. Banks may approval all,
some, or none of these fees. We may reserve the right to rename any of these fees as banks may have
specific items that have to be labeled a certain way as each of them have different policies.
1. Credit Service Fee and/or Attorney Fee: 1% - 1.98% of sales price of short sale property
2. Settlement Fee: $1000.00 - $2,000.00
3. Title Services: $1000.00 - $1500.00
4. Document Preparation: $350.00 - $500.00 (Depending on the number of liens)
5. Lien Review: $250.00 - $350.00
6. Mortgage Payoff Procurement: $350.00
7. Negotiation Fee: $500.00 - $995.00
8. Notary, Overnights, misc: $75.00-$150.00
*In the event, there no cash contributions, promissory notes and/or deficiency judgments, ATC total fee
collected may exceed the amounts listed above or if approved by the seller.
First, we perform our best efforts to obtain a short sale approval. Second, if there are any terms such as seller
cash contributions, bank requested promissory notes, and deficiency judgments, ATC will negotiate these
terms to the best of our ability. The Seller has the right to refuse the terms of the short sale at any time.
DEFICIENCY JUDGMENT DISCLOSURE STATEMENT REGARDING FEES.
Deficiency Judgments are applicable by State Law. In a deficiency State, we are not always able to have this
deficiency waived due to circumstances beyond our control.
Seller acknowledges and approves that ATC may be compensated by the short sale lender and other parties
according to the Service Agreement an amount equal to five thousand ($5,000) in credit service fees
associated with the transaction even if a deficiency judgment is not waived for the short sale. The Seller
fully releases ATC of any liability as a result of this particular compensation and outcome.
SIGNED___________________________________DATE_____________________
SIGNED___________________________________DATE_____________________
When a Buyer submits a contract, the short sale clock starts ticking, therefore,
an approved title company must work in conjunction with ATC, seamlessly.
TitleCompanyAddendum
Thetitlecompanyplaysanimportantroleduringthebeginningandsettlementstagesoftheshortsaleprocess.Propertyreports,liensearches,andprelimHUDsmustbeaccuratelypreparedanddeliveredtotheshortsalelenderwithin24-48hours.Toensureatimelyclosing,ATCFinancialcanrecommendatitlecompanythatunderstandsourpoliciesandrequirementsfromourapprovedlistoftitlecompanies.AnybuyerselectedtitlecompanymustbeapprovedwithATCFinancialbeforeashortsalepackageissubmitted.
_________:Option1(Pleaseinitial):TheBuyerhasagreedtoallowATCLegalandFinancialtoselectthetitlecompanyforthepurposeoffacilitatingtheshortsaletransaction.
________:Option2(Pleaseinitial)TheBuyerhasselected___________________________________________asthetitlecompanyforthepurposeoffacilitatingtheshortsaletransaction.
PropertyAddress:___________________________________________________________________________________
________________________________________________ ________________________________________________Buyer1(Signature) Buyer2(Signature)
TitleCompanyName________________________________________________________________________________Phone:__________________________________________Email:_________________________________________________
IfthebuyerselectsadifferenttitlecompanythatisnotonATCFinancial’sapprovedlist,thenewtitlecompanywillabidebythefollowingtheguidelineslistedbelow.Failuretocomplymayresultinadelayoftheshortsaleprocess.
o ProvideanestimatedpreliminaryHUD1basedontheinformationprovidedinthecontracttobesubmittedwithourshortsalepackagetothebankwithin5businessdaysorless.
o ProvideaCurrentOwnerPropertyReportwithin5businessdaysorless.TheReportwillindicateaFeeSimple,orLeaseholdProperty,includeCurrentOwner,Mortgages,Liens,LocalCitations,Judgments,FrontFootBenefitsandpropertytaxstatus
o ProvideaninsurableCurrentOwnerTitleSearchwithin5businessdayso Nofeesincludingtitle,escrow,attorney,documentpreparation,wire,courier,etc..willbe
chargetothesellerfromthetitlecompanyunlessapprovedbythesellerandshortsalelender.
o ThetitlecompanyhasagreedtocommunicatedirectlyandimmediatelytoATCFinancialonanyandalldiscoveriesorchangesthatmayaffecttheshortsaletransaction.
o SettlementAgentorClosingAttorneywillaccommodateallpartiesandconductsettlementatthedate,timeandlocationselectedbytheSeller(s)
o UponShortSaleApproval,thetitlecompanywillcoordinatewiththebuyerstoprovideaFinalHUDbeforeclosingtoATCFinancialbaseduponthetimelineindicatedintheclosinginstructionssetforthintheShortSaleApprovalLender________________________________________________ _____________________ TitleCompanyPrincipal(Signature) Date
Sample General Addendum
All parties agree that this addendum supersedes all other addendums. Wherever this addendum and the general body of the contract conflict, this addendum will control. All other terms and conditions of the above referenced Contract of Sale remain as originally agreed:
Home Inspection shall be completed within 7 days of
contract ratification, NOT bank approval
Short Sale contingency period must be a minimum of 90
days for bank approval
Buyer and Seller agree that settlement will take place at ATC
Financial’s recommended title company due to the complex
nature of the short sale transaction
Preliminary HUD
Approved HUD
IF YOU ARE THE BUYER’S AGENT FOR A SHORT SALE If you are ever the buyer's agent and want to purchase a short sale listing, make sure you protect your buyer's by asking the following questions. This will give you a better idea of the level of expertise and where the file stands in terms of how long and if a short sale transaction is viable.
1. Who is negotiating the short sale? Do they have a credit service license? 2. Ask them for a blank standard copy of their short sale agreement to make sure its in compliance with the DLLR, FTC MARS ruling 3. Is the Seller FHA? (If so, have they already been declined for a loan modification and approved to proceed with the short sale. Without knowing this, you may be delayed for an additional 60-90 days before the short sale even gets reviewed). If the seller is FHA and if you Buyer's NEED closing cost help (seller concession), your buyer's need to be FHA as well to qualify for 1% closing help. Otherwise, its 0% help according to FHA. Look for sellers with conventional loans if you need closing help higher than 1%. 4. Is there Mortgage Insurance on the property? If so, this could kill the deal since Mortgage Insurance Companies are typically in first position and prefer a foreclosure unless the seller is willing to provide a cash contribution or accept a promissory note. What experience does the negotiator have in dealing with Mortgage Insurance? 5. Has a pre-package already been submitted? Many banks nowadays will accept prepackages. If your negotiator is experienced, they should know which banks accept prepackages, therefore, you will know if all they have all the seller docs have been sent for preliminary approval. 6. If a third-party company is doing the negotiation (attorney, title company, or independent), how are they paid. Do you charge the sellers or real estate agents any fees? And what type of updates would I expect to receive during the process? These are very important questions that need to be address if you want your buyer's to be aware of the level of difficulty, time and success of the short sale transaction. ATC generates pre-packages for all their sellers, if applicable. ATC will provide weekly status updates for both agents on the progress of the short sale ATC has a Maryland Credit Service License which is required to negotiate deficiency judgments and promissory notes associated with short sales
Our ATC Management Team
410-779-1000
Sean M. Der, Co-Founder, Director of Operations [email protected] James T. Weiskerger, Co-Founder, Director of Marketing [email protected] Diana Grueva Khan, Executive Vice President of Operations, Senior Case Manager [email protected] Kendall Manges, Senior Case Manager [email protected]
To list your home visit Nick Gioia with Re/Max Sails at: BaltimoreRealEstateSales.com