End Buyer Funding on a Short Sale

If you’re having issues and snafus closing your short sale deals because of your end buyer’s lender, you may want to look at controlling that aspect of the deal. It’s becoming more and more prevalent these days that snags arise as conventional lending guidelines and seasoning issues get goofier and goofier.

I found that when I have an end buyer use my lender, there aren’t any problems in closing deals. But when the end buyer uses their lender, the chance for something going haywire is so much greater.

This happened to me last week. As soon as I got short sale approval, I told my listing agent that I wanted to shuffle the buyer to my lender. She said the buyer is pretty insistent on using their mortgage broker. I called the broker and introduced myself. I explained that since short sales are so time sensitive, and had to close by a certain date, that I preferred to have the buyer use our lender, who can close very quickly.

The broker said she had 21 years experience with fast closings and VA loans. She never had a problem. The buyer was a vet. Against my better judgment, I didn’t press the issue to use my lender. BIG MISTAKE. 7 days before the close date, and 8 days before the foreclosure auction, the buyer didn’t qualify for his VA entitlement. I was ticked at myself for not following through. This could have been avoided entirely if I used my guy.

We immediately put another offer in to the short sale lender. The investor was Freddie Mac. They declined the offer, saying it was too close to the auction to review and they wouldn’t postpone. So they took it to sale.

All I can say is: control as many aspects of the short sale as possible.

The road to real estate and short sale negotiating

I’m a descendant of the family of man. I grew up in Ocean Township, NJ over half century ago. Spent my youth at the beach negotiating waves and beating up my younger brother. My dad was a lifetime public school administrator and my mom was a nurse. Hard-working parents.

Really loved my childhood. My mother welcomed all the neighborhood kids into our house to play and raid the fridge. Jersey was a temperate clime, so we played baseball in the summer, football in the fall, threw blistering ice balls at each other in winter, and healed our wounds in the spring…only to repeat the cycle all over again. And beat up my brother.

As a kid, to make money, I’d go door to door negotiating with neighbors to use my services to rake the leaves or shovel snow or to buy greeting cards they didn’t need.  I remember always working, even at a young age, because I enjoyed it and the invigorating feeling of pulling my own weight. 

Graduated Ocean Township High School. Went to Emory University in Atlanta, GA in the 70’s. My hair looked like Linc from the Mod Squad. If the reference is dated, think Malcolm Gladwell or Art Garfunkel. Get the picture? Not pretty. Dates were hard to come by…no surprise there. 

Majored in Biology and took lots of sciences. Thought I wanted to go to Med School, but instead went to Dental School. But only for a year. Because while in college, my main love was comedy. Directed and performed in an improvisational sketch comedy group for 4 years. I left dental school after my freshman year and moved to Chicago to study with Second City. I found my bliss, my passion! 

Performed in two improv groups for a couple years, then started doing standup comedy. This was in the early 80’s. My standup career lasted 15 years. Moved from Chicago to New York City in ’85 and settled in at The Improv as my home club. Worked the circuit, went on the road, did some tv. Really loved making peeps laugh. When the club scene fizzled in the early 90’s due to over exposure and saturation, I started performing on cruise ships. Worked all over the Caribbean. Had a blast.

In ’95, my girlfriend (now wife) and I moved to LA. I was writing screenplays, so I figured LA’s the place to be. Plus, I just got a new agent who was very encouraging. While making the production rounds, I made my way as a copywriter and producer for tv and film promos, trailers, epk’s, movies, popular shows like Seinfeld and Frasier, kids’ programming, news and sports, and sales packages. 

Got married in ’96 to the most amazing woman on the planet. Been together 17 years and it keeps getting better. Our daughter was born in ’99. In ’01 we moved to Sedona to raise her in the clean air and natural beauty. My career also changed…drastically. Plunged into real estate investing knowing very little about real estate.

Took a bootcamp and WHAMMO! I’m an investor. Go figure. With my wife’s support (since we had little money, I needed all the help I could get) I learned how to buy houses with no money and no credit. In 18 short months we bought 40 houses with none of our own money. Rentals and lease options. Fell into short sales in ’03.  Found I had a knack for negotiating with the banks. Been negotiating short sales full time ever since.

So over the past few years I’ve taught and coached investors short sales and how to negotiate effectively. Feel very fortunate to have learned from some wonderfully talented, smart, and generous people. Belonging to several mastermind groups over the years has also helped. Invaluable, actually. I surround myself with people and businessfolk who keep me on my toes, honest, call me on my bs, and give it to me straight. We share ideas, strategies, and stay current with the market and all the changes and challenges that are taking place at lightning speed.

I’m a lucky man.

I still beat up my brother. Headlocks, mostly.

Now it’s time to share what I know with you…