We've all dealt with 2nd mortgages, and they continue to be an issue for anyone negotiating short sales or trying to reduce their mortgage liability for a loan modification. Discover how we've helped clients negotiate with their current 2nd mortgage holders and junior liens, saving them hundreds-of-thousands. http://www.eastlionre.com/
Let's take a look at the 'mentality' of what a junior lien holder is facing, and why this remains a challenge. They don't have any equity backing their loan, they can't foreclose on the home (technically they can, but they don't) and the seller usually doesn't have any money to bring to closing. So they're backed into a corner. Now let's look at some things in your favor...
The 2nd Mortgage really doesn't have a lot of options. If the 1st forecloses, then the 2nd Mortgage will get wiped out completely. At least with a short sale, the 2nd gets $1,000-$3,000 typically, and sometimes more depending on if the 1st allows it.
Also, the 2nd mortgage just needs the same paperwork that you've submitted for the 1st mortgage, with their loan information on each page. The last thing is that most of the time the house is so upside down (ie: negative equity) that they don't do an internal BPO or fight your offer price. If you have questions on how to begin the negotiating process with your junior lender, contact me today: Ashish Trivedi: Ashish@EastLionRE.com
So with all of the above, successfully negotiating with 2nd mortgages comes down to:
1) Get the 1st to pay as much as possible to the 2nd. The more they pay, the better your chances are of having a closing. Here's a quick example: Ask the 1st to give the 2nd $5,000, then ask the 2nd to accept $1,000. If either of them take it, or meet in the middle, then you can have your closing.
2) Get the 2nd a clean short sale package, with their loan number on every page...and their own forms filled out. In Short Sale Commander, we have most of the main 2nd mortgage short sale forms in our Auto Forms tab. These auto-populate so it gets through their red tape faster. Also, you can build the 2nd Mortgage short sale package in about 1 min, with the 2nd mortgage loan number on every page.
3) Set proper expectations with the seller. Too many agents don't do this at the listing. The thought of telling the seller they may need to bring some money or sign a promissory note to settle the 2nd never crosses their mind. Here's what you can do: Explain to them that they have a $75,000 problem on their hands that they'd like you to help them out with. You'll do everything you can to get it taken care of, but if they have to bring $1,000-$2,000 to closing or sign a much reduced note to get out of $75,000 debt, are they willing to do that?
You'll also need to keep notes and have seamless communication via email & fax with the 2nd, just like with the 1st mortgage. If you need to escalate the file at the 2nd mortgage, you can sort and export all the 2nd Mortgage Activity Log entries and get it to the escalation dept or a manager.
Thinking about a loan modification or Short-Sale? Contact Us Today for free consultation.
Thanks for reading this, Ashish Trivedi.
Ashish is a Real Estate Broker
Phone: (818) 259-3455. Ashish@EastLionRE.com.
View My homes for sale at http://www.eastlionre.com/
Ashish Trivedi specializes in loan modification assistance and short sales in San Fernando Valley California. San Fernando Valley Loan Modification Help, San Fernando Valley Short Sales. San Fernando 1 CA Short Sales. 1 Realtor.
The views expressed here are Ashish's personal views and do not reflect the views of
Copyright 2011 SFI Marketing Institute, LLC. All Rights Reserved.
Important Notice:
Ashish Trivedi, , and the Stop Foreclosure Institute are not affiliated in any way, shape, or form with the government. Our services have not been reviewed or endorse by the government or your lender. Most lenders willingly work with agents on short sales. Why?
Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit.
However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification.
We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision.
This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.
You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale.
Let's take a look at the 'mentality' of what a junior lien holder is facing, and why this remains a challenge. They don't have any equity backing their loan, they can't foreclose on the home (technically they can, but they don't) and the seller usually doesn't have any money to bring to closing. So they're backed into a corner. The 2nd Mortgage really doesn't have a lot of options. If the 1st forecloses, then the 2nd Mortgage will get wiped out completely. At least with a short sale, the 2nd gets $1,000-$3,000 typically, and sometimes more depending on if the 1st allows it.
Also, the 2nd mortgage just needs the same paperwork that you've submitted for the 1st mortgage, with their loan information on each page. The last thing is that most of the time the house is so upside down (ie: negative equity) that they don't do an internal BPO or fight your offer price. If you have questions on how to begin the negotiating process with your junior lender, contact me today: Ashish Trivedi: Ashish@EastLionRE.com
So with all of the above, successfully negotiating with 2nd mortgages comes down to:
1) Get the 1st to pay as much as possible to the 2nd. The more they pay, the better your chances are of having a closing. Here's a quick example: Ask the 1st to give the 2nd $5,000, then ask the 2nd to accept $1,000. If either of them take it, or meet in the middle, then you can have your closing.
2) Get the 2nd a clean short sale package, with their loan number on every page...and their own forms filled out. In Short Sale Commander, we have most of the main 2nd mortgage short sale forms in our Auto Forms tab. These auto-populate so it gets through their red tape faster. Also, you can build the 2nd Mortgage short sale package in about 1 min, with the 2nd mortgage loan number on every page.
3) Set proper expectations with the seller. Too many agents don't do this at the listing. The thought of telling the seller they may need to bring some money or sign a promissory note to settle the 2nd never crosses their mind. Here's what you can do: Explain to them that they have a $75,000 problem on their hands that they'd like you to help them out with. You'll do everything you can to get it taken care of, but if they have to bring $1,000-$2,000 to closing or sign a much reduced note to get out of $75,000 debt, are they willing to do that?
You'll also need to keep notes and have seamless communication via email & fax with the 2nd, just like with the 1st mortgage. If you need to escalate the file at the 2nd mortgage, you can sort and export all the 2nd Mortgage Activity Log entries and get it to the escalation dept or a manager.
Thinking about a loan modification or Short-Sale? Contact Us Today for free consultation.
Thanks for reading this, Ashish Trivedi.
Ashish is a Real Estate Broker
Phone: (818) 259-3455. Ashish@EastLionRE.com.
View My homes for sale at http://www.eastlionre.com/
Ashish Trivedi specializes in loan modification assistance and short sales in San Fernando Valley California. San Fernando Valley Loan Modification Help, San Fernando Valley Short Sales. San Fernando 1 CA Short Sales. 1 Realtor.
The views expressed here are Ashish's personal views and do not reflect the views of
Copyright 2011 SFI Marketing Institute, LLC. All Rights Reserved.
Important Notice:
Ashish Trivedi, , and the Stop Foreclosure Institute are not affiliated in any way, shape, or form with the government. Our services have not been reviewed or endorse by the government or your lender. Most lenders willingly work with agents on short sales. Why?
Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit.
However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification.
We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision.
This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.
You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale.
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