If you’re a preforeclosure investor, with the tightening
credit markets, you have no doubt noticed how much more
difficult it is these days to close short sale deals.
Short Sale Formula is a comprehensive course that will
provide you everything you need to put together a short
sale packet, outsource your short sale negotiations and
then use a back-to-back closing to close your shortsale.
In the past, plenty of hard money options, along with
double closings and simultaneous closings made closing
short sales a breeze. However, with the credit crunch,
mortgage fraud, and tighter restrictions with lenders
and title companies, closing shortsale isn’t as easy
as it used to be.
However, there is still one very simple and easy
way to close your shortsale transactions without
using double closings, hard money, simultaneous
closings, or even the over complex land trusts.
That method is using back-to-back closings to
get all of your short sale deals closed and
funded on time. Short Sale Formula will teach
you how to conduct back-to-back closings once
a short sale has been negotiated. Back to back
closings take a short sale deal and turn it
into two separate and distinct transactions.
The first transaction is the homeowner facing
foreclosure selling to the preforeclosure
investor. The second transaction is the real
estate investor then selling the property to
the end retail buyer. However, even if you
are using a back to back closing, and your
end retails buyer has secured their funds,
what makes this work is that you need to
secure your own funding, as the real estate
investor.
So where do you get this funding of your deals?
This is often called transactional funding,
and today, there are many lenders making these
types of loans. Lenders love transactional
funding, because they are only lending for
a period of a few hours.
With the end buyer’s loan already approved
and in place, two separate and distinct
transactions take place on the closing day.
The first is the investor purchasing the short
sale deal from the distressed homeowner.
This is funded by the transactional funding company.
Immediately after this transaction has closed,
the investor is then turning around and immediately
selling the property to the end buyer.
The end buyer is using funds obtained by him through
a traditional loan, or cash. Most conventional lenders
today won’t have any issue funding these loans.
The only such exception are FHA loans, which at
the time of writing this article, have a 90 day
seasoning requirement. However, as the real estate
market changes, and the housing market remains
volatile, it is very possible that the FHA might
change its guidelines.
Transactional funding is the perfect way for
preforeclosure investors to fund their short
sale deals in today’s foreclosure ridden market.
There are plenty of choices for funding companies,
all willing to fund these simple, easy shortsale
transactions. Short Sale Formula provides a short
sale training that shows you exactly how to put
together a short sale packet for successful
negotiation as well as how to close and fund a
deal once the successful negotiation is complete.