Archive for 'short sales versus foreclosure'

You Can’t Buy & Flip Houses in Sloooow Motion

buyiyflipitAs a Mentor, one of the biggest things I stress to my Students/Partners is that you can’t buy and flip houses in sloooow motion. As soon as a Seller calls you, you should fill out a Seller Information Sheet and schedule for the following day (within 24 Hours) an appointment to see the house. Most of the information that is needed on the Seller Information Sheet you can get directly from the Seller. I have been asked “How long do you talk to a Seller about their home?” Since this is your first communication with a Seller and you NEED to build rapport, you should be on the telephone for a long time. What does that mean to you?

I would suggest at least 30 minutes on the phone to talk to the Seller about their home, their life, where are they going…anything and everything you can think that you might have in common with the Seller. Sellers like to do business with people they like. So, if you are only on the telephone for 5 minutes, then did you build rapport or even completely ask all the questions that are on my Seller Information Sheet? Probably not. Call the Seller right back and ask ALL the questions on the Seller Information Sheet so that you will know what he/she wants for the house, why they are moving, where they are moving and when they want to leave.

What if the Seller doesn’t give you all the information? Then you need to look it up on the public records. You also need to immediately drive by the exterior of the home and if it is vacant, look in the windows and/or secure the home for some people. Sellers assume you have already driven by the house and you are to give them an Offer right over the phone without even knowing anything about the house. You want to know everything you can about the Seller, as the only thing that makes a great investment deal is a motivated Seller. If you don’t have one, then you won’t get the price you need to make it a great investment deal for either a flip or hold.

Recently, I dealt with one of the most difficult Sellers. A Partner and I wanted to go to his personal house in Orange City to get him to sign the Purchase Agreement WITHOUT seeing the inside of the 2nd house he owned. He insisted for us to wait. We overnighted the Purchase Agreement to him, based on the facts that we drove by the vacant home, looked in the windows and knew the values in the neighborhood. We called him to see if he would sign the Purchase Agreement and return it and he informed us that we could now get inside the house to see it. We went inside the house and immediately called him back. Again, we wanted to get him to sign the Purchase Agreement. He had an excuse that his daughter also had to sign and we even offered to drive it to her. In the end, he sold the house to the neighbor at the same $50,000 price that WE had negotiated, for a house worth $140k with minor repairs. He didn’t even allow us to counter our price. What is the lesson on this deal? Drive out to his house and just stop by and see if you can get him to sign it. What if he said no, can’t come in and/or no he won’t sign it right now? Well, we lost the deal anyway so what do you have to lose? See if you can get both Sellers in one location for signing.

Another Student contacted me about a great short sale that had loads of equity in the home. She went by the house, took pictures and even secured the house with new locks since the house was unlocked. I sent the Seller the Offer overnight with a return envelope, at the asking price that she wanted. The Student went on vacation and I called the Seller several times. The Seller had built the rapport with the Student, not me, so I did not have the relationship that the Student had. I finally got a hold of the Seller and she informed me that she received another offer which was $6,500 higher than ours. I told her that we could match it, as the Student did get in to see the house after our last call. She refused to sign with us and said she was going with the other person. The Seller lived out of town, so how do you think you could have made this deal work? I believe constant contact with the Seller with long discussions to build better rapport. Obviously, the other investor offered higher, offered to pay for an attorney and could close in 10 days or less. Which doesn’t always happen due to inspection, title work and closing package; however, they locked the deal. Next time, I would suggest that listening longer as to what the concerns are with the Seller will get us the deal.

Another Student spoke with an elderly woman who owned a vacant home. The student gave her the amount that she wanted, prepared a purchase agreement and even went to her location where she lives. She then said that she had things in the house that she wanted and needed to wait 2 weeks prior signing the purchase agreement. The student did offer to help her move her belongings and extend the time of closing on our Purchase Agreement, however, she still wouldn’t sign. As to the status of this deal, I don’t know yet. The Student definitely needs to go again to the vacant house and see if there is any activity there and go to the Seller’s house and get the deal signed. However, obviously we did not really find out her main concern why she won’t since the contract, so it will take another 30 minutes at her house, face to face, to get this deal done.

My hope is that this article will deeply impress upon you the importance of a 24 hour contact with the Seller, going to the house, whether or not you can get in, filling out the Seller Information Sheet with all the information on the home, knowing your comparables and having the Purchase Agreement ready to be signed the day you go to the house. Let me ask you as a Buyer: Do you have to buy the house, if after the inspection you found out that your repairs are too much or you won’t make any profit on the house? No, you don’t have too; however, you have locked the house up for at least 15 days for inspection and no one else can buy the house. Also, if the price is not a good deal for you, you can always counter the Seller at that time, after inspection, to see if you can make it a win-win situation. If not, then you didn’t lose anything. You did receive the knowledge and the experience of dealing with a Seller, identifying repairs on the house and how to make the next deal better!

Please keep sending me your questions and topics that you would like to hear about, so I can be sure to keep feeding you with the information that you need in order to move confidently through 2016 and bring your Real Estate Dreams to Life!


Kimberlee Frank

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Short Sale or Foreclosure can cause Death to Sellers

nationstar shortsaleMy office has been working on a file for over 1 year with Nationstar and a couple who put their faith in my Company’s skills to get a short sale approved. We listed the property and immediately received an all CASH offer from our Buyer. Nationstar sent out a Realtor to do a Broker Price Opinion (BPO) on the property and then instead of countering the existing buyer, they informed our office that they are now using to do a valuation process of the property. What that meant to the Sellers is that the existing Buyer on the property would not receive a counter offer on the property, but the Realtor was to hold 2 open houses in order to make sure that Nationstar received their highest and best offer.

We received a Buyer for $80,000 from and the existing Buyer would have to be released from their existing contract or Nationstar would not agree to the short sale. Right after the first Buyer for $60,000 was released, the Buyer through backed out. We were instructed to increase the list price of the property to $89,900. We did and got another CASH offer for list price based on the instruction of the negotiator from Nationstar. Time went on and as it did, Nationstar again decided that the $89,900 was not enough and we, as the Realtor, were instructed to hold 2 additional open houses for for their valuation process. No one bid on the property, so we assumed the $89,900 cash buyer was going to be accepted. On the website it stated “Short Sale Approved,” but it was NOT approved yet. We then got another negotiator who said that we had to increase the list price AGAIN to $125,000.00, which caused us to lose $89,900 cash buyer. We then got a new cash buyer at $125,000.

During this time, Nationstar did not stop the foreclosure action against our Sellers and continued to hold a Motion for Foreclosure wherein it would set a sale date when the property would be sold. The Sellers, who were already struggling immensely, hired an attorney who got us an additional 90 days to process the short sale due to the delay caused by Nationstar and their valuation process. We tried our best to advise the Sellers that we should be able to get this offer of $125,000 through Nationstar and please be patient and hang in there. I am not really sure how much more stress our Sellers could take. They had to move out of Florida due to a job relocation for the wife, and the husband still had to find a job in the new area. That stress alone of moving across the country and not having a job would be enough to cause sickness, anxiety, depression, stress, frustration and the list goes on. And then, add in the constant fight that we were having with Nationstar to get our offer approved; this was more pressure than the husband could take.

Even though the website had stated this was “short sale approved,” it took a couple months for them to process our new buyer.   The buyer had a deadline in which they needed to close, and after at least 2 months of waiting, Nationstar still hadn’t approved their full price offer and the buyer had 1 week to find a new home, so they walked. Nationstar again decided that they were going to do yet ANOTHER valuation process and requested that the house be placed for auction with

No new offers came in, as we truly believe that the $125,000 is a very high offer for this property. And, in this price range, you will most likely have a mortgage buyer, so all we could do is pray that a mortgage buyer would get approved. We finally received a mortgage offer at $112,500 and submitted this to the bank. Finally, Nationstar accepted the $112,500 offer………. only too late, because by then my Seller had committed suicide from the stress of everything. We were unable to tell him that we had a short sale approval letter from Nationstar and all we needed now was an approval from Bank of America, who was the 2nd lien holder.

But wait … Bank of America could not issue us a short sale approval letter because their servicing contract was going to be terminated in 10 days and Carrington was now the new servicer of the 2nd lien. Our just-widowed Seller/wife, had to deal solely with all the stress of everything in her life because her husband was no longer alive. We all cried at our office with much sorrow for this entire situation, and I personally was furious at Nationstar for dragging their feet to get this deal done.

Even though we have an approval letter from Nationstar, there is now another court date which the Seller’s attorney must request a postponement for in order for Carrington to provide us with the approval letter. It has been over 3 weeks since the date of the letter that Carrington is the new service provider and NO ONE there has the file yet. More stress for our Seller. So, all we can do is present our case to the Judge and pray that he will see the games that the banks are playing against our Sellers and he will grant another 90 days for the process of the short sale. Unfortunately, because we have a mortgage buyer, they will need 30 days to complete their closing process wherein the first approval letter from Nationstar will need to be extended. I really hope that this file screams out to Nationstar for them to see what they are putting our Sellers through and will not attempt to place this property again on and will just grant us an extension to close.

Many short sales that we process are simple and once the Bank sends out a Realtor to do a Broker Price Opinion (BPO) they counter the existing Buyer and we can get a deal going. Other Banks don’t doubt the value that was provided to them from the BPO agent who they themselves hired. We normally fight the banks on behalf of our Sellers without them knowing many of the things that the Banks are arguing. All Banks want money from Sellers and believe it or not some Banks will pay Sellers up to $33,000 just to do a short sale.

The Banks are constantly getting laws passed in the State of Florida for their own benefit. In January of 2014, the Banks are able to get a deficiency judgment at the time of the foreclosure action against our Sellers and also still have the asset to sell. WHO IS FIGHTING FOR OUR SELLERS??!!! We believe that there should be a voice for the Sellers and as one of those voices I am saying to the Banks “STOP IT.” Stop taking advantage of the Sellers wherein the Banks are receiving FDIC bailouts, some loans have private mortgage insurance which will pay the Banks 20-30% of loss. Stop dragging their feet so that we can push the short sales through and the Sellers can move on. I ask you, as you are reading this article, who is on the losing side of this battle? The Sellers who put all of their savings as a down payment on a house, maybe even fixed it up, will they ever receive a return on their investment? The answer is “NO,” unless the Banks allow the Sellers to receive money at closing.

My tears are for the loss of my Seller, for his wife, for his family and for many other Sellers who are depressed and don’t know where to turn. I say to my Sellers “Don’t Let the Bank Win.” This phrase is on my office window and it’s on my car. Fight back with a short sale and for more information go to for information on how you can fight back.

As a Realtor working on behalf of my Sellers, I am ashamed to work with Nationstar as I believe they don’t follow the rules of other Banks and I am very sorry for the loss of my Seller. My office will continue to fight the fight with all Banks in order to make the voice of the Sellers heard. I want the banks to understand that just because they are in foreclosure and attempting a short sale, my Sellers are not bad people. Bad things happen to good people, but it doesn’t make them bad people. We make the Banks read their hardship letter and understand their situation. We show the banks that it’s not that the Seller just decided to stop making payments, but that they had to relocate, couldn’t sell it and had no choice but to do a short sale.

As Investors and Realtors, you need to step forward and help the Sellers. Make offers on the short sales and fight for a deficiency waiver for your Seller and make sure that their voice is heard. Sometimes as a Broker, I take a loss on a file because of the time it takes for the Banks to process the short sale. I don’t mind when this happens, as this is my contribution back to the community and a way that I can help people move forward during a highly stressful time in their lives. I will continue to fight the banks and also teach Realtors and Investors how to fight the fight. At the present time, I have saved Sellers and Buyers at least 37 Million Dollars and counting.

I have several trainings available to Investors and Realtors who want to help the Sellers. Make sure you check out my websites below and remember – DON’T LET THE BANK WIN!!!

Happy Negotiating!

Kimberlee Frank

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Short Sales are Sailing

short sale sign held by ladyMany Investors and Realtors avoid short sales like the plague.  They are definitely missing the boat!  My business specializes primarily in short sales and I have seen an increase in the number of approvals we are getting.

The time line for a short sale varies from 90 to 120 days if you submit the lender a “complete” short sale package.  Since short sales are dominating the market, the Lenders are creating more streamlined processes to conduct smoother short sales.  If you do short sales, then I am quite sure you have heard of the online system called “Equator.”  Equator allows all of the short sale paperwork to be processed electronically through one common venue, versus traditional and random faxes and emails.  Having a file processed online avoids the common objection from the short sale lender of “We didn’t receive the documents.”  Effective January 1, 2013, the newest lender that has started to use Equator is Chase.  The following lenders and servicers are presently using Equator:  1) Bank of America, 2) Chase, 3) Wells Fargo, 4) GMAC, 5) Nationstar, 6) ASC, 7) Carrington Mortgage, and 8) Homeward Residential Services.

The Equator System assigns applicable tasks to each party (Agent, Negotiator, Closer, etc) including a deadline in which to complete each task.  I like the fact that the lenders can no longer say “Oh, we never got that paperwork.”  However, I don’t like the fact that they are tracking our information.  Nationstar has taken the collection of Buyer’s information to a whole new level.  They require all Buyers to fill out a loan application even though they most likely will not be using Nationstar as a lender.  This application has been mandatory and this has not been waived on any of my files.  If you are a Buyer on any property, you are required to provide your name, address, telephone number, DOB, SS#, assets, employment history and more.  This is regardless if you are purchasing for investment or personal use and if you are getting a mortgage or paying cash.

I believe that the lenders are collecting data against all Buyers and will soon share with each other how many deals each Buyer has purchased.  I had one student inform me that once he purchased over 10 properties from Bank of America, he was no longer allowed to purchase any more in his name, his wife’s name or company name.  Therefore in the future, when all lenders work as a team, they will share all of this information and limit the amount of deals that an Investor can purchase.  Wells Fargo started using a system called CoreLogic approximately 2 years ago which allows them to simultaneously check to see who was applying for a mortgage at the same time they were conducting a short sale.  This caused Investors a hardship even though they fully disclosed to Wells Fargo their intention to buy, resell and/or fix the property, if they used my paperwork.  Many short sales were not approved at that time and many Investors had no idea WHY?  Some of the lenders frown on the fact that Investors are purchasing the property and would rather sell the house to a homeowner.

You would think that the lenders, since they are funded by Investors, would understand how we Investors work.  We don’t buy properties at full value, as we are not going to live in the home.  This is a business and we can’t make the Seller’s problem our problem by paying full value.  It is the Investors, like us, that are helping the lenders get money and not go under.

Now is the time to purchase short sales and if you haven’t started you have 10 years to ride the wave, so do it now!  Align yourself with a good Mentor and take flight just like many Investors around the world.

Happy Sailing,

Kimberlee Frank

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