Foreclosure and short sell......?

Question

I am in the middle of a foreclosure on our home. It's not like I was irresponsible, but life kind of took a bad turn. However, I have been looking at companies who may want to work with the lender on a short sell situation. The company is called Lewis (or Louis) and Associates and they seemed to be reputable. The cost to me is $995 and they have high marks with the BBB. Does anyone know anything about this company? The thought of getting out from under this foreclosure may be fogging my mind. If you have any information, I would appreciate it.

Is there anything I need to know going into this? Any questions I need to ask?

Answer 1

1. Many investors attempted short sales. I say attempt as it really requires the lender to play ball and for the lender to take less than they are legally owed.

2. I have not heard of a company charging a fee for short sales. As an active investor I am surprised that I have not heard of any other company charging a fee.

A short sale can lead to nothing and there can be a lot of work chasing the lender. It might make sense for a company to want to be paid. Note that I would expect that if they line up a short sale they are making a success fee in that they will be somehow participating in the deal.

In this deal it looks like they get something from you and maybe something on the back end if the short sale works. You are out the money in either case.

3. You may avoid a foreclosure but you will not avoid having some pretty negative markets on your credit. Saving the property and your credit from a full blow foreclosure is valuable.

4. There are deals that are almost predictable when it comes to a lender not agreeing to a short sale. Some investors can tell before starting that it will never happen. You need to consider the facts in your case to determine if the $995 is being well spent or a predictable waste of the limited cash you do have.

For no fee I can detail what is likely if you want to go through the numbers. Send me an email or post a comment on my blog. Just make a point of saying that the information is private and I will make sure that I reply by email.

In conclusion I think it is great that you want to stop the damage if possible and that you might even spend some money to accomplish the task. Lets see if we can improve the odds that you get value for money. There are some other things to do which can improve the odds that you dodge the foreclosure bullet. Each person is different and the details matter. You need to look at the whole picture. As you noted your mind might be a bit foggy right now so double checking is important.

Depending on your state there can be some specific rules and regulations that apply when any investors/buyers/advisers speaks with you concerning your foreclosure. The rules are there to help you but in some cases they shut down your options so you have less opportunity to stop a foreclosure.

Answer 2

There is alot to consider here, start with your mortgage company, are they willing to reduce your rate or offer you a temporary hardship? Do they recommend any affiliates to help you with the sale. some companies will accept a short sale and waive the diffrence leaving you in the clear (rare though) A forclosure is going to haunt you for a long time, you may not be able to secure any home loans or car loans or credit cards for that matter. How many months past due are you? 1-3 and you may have a chance to refi with an interest only loan with a subprime lender (hurry though, they are all going under) 4-7 and you are in real trouble, sometimes banks will write a loan if you can bring the loan current. This involves a nother loan though, most times from a family member. All in all I would ask to speak to your companies collections dept 1st, not all of them are as rude as they seem, keep calling back and asking for another person or find a manager.

Answer 3

What will the company do for you for the fee?

It sounds like this company attempts to negotiate a short sale on your behalf? Do you have the property listed with a Realtor? A short sale is only possible if you have a buyer lined up to buy the property.

I am aware of companies that will pay you for an option on your house and then try and sell it before the foreclosure. I have seen post on here about those. Take a look at foreclosure topics. Good luck.

Answer 4

I assume this company is only going to negotiate a short sell with the lender and not actually find a buyer for the property?

If so, then call your mortgage company and ask to speak with someone who handles short sales. The lender is not going to do anything for this company that they wouldn’t do for you if you called them directly. So basically you’re paying this company $1000 to do something that you can do yourself.

Generally speaking:
--a lender normally will not approve a short sell if there are other liens on the property
--they normally only approve a short sell if it’s a true hardship situation--that means you simply cannot afford to pay the mortgage and the reason for that was something completely beyond your control

They will likely first ask you to fill out a financial package, where you’ll list your income, expenses, assets, etc. They won’t approve a short sale if you can afford to pay the difference. For example, if their loss on a short sale would be 10,000 but you have 10,000 in assets, then they won’t agree to take that loss.

Good luck.

Answer 5

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Answer 6

You can also go to a mortgage lender and have them do a forclosure buyout. Contact me if you need help or have questions. I'm a licensed mortgage banker.