This week has been an awesome learning week for me in my business and I want to share that with you. As you may or may not know my niche for finding properties to invest in or list on my MLS is short sales or pre-foreclosure properties.
This week I received a call from a new home owner that wants to sell their property and invited me to their house to take a look and were hoping that I would help them sell their house (if you’re marketing efforts are not putting you in this position you need to adjust!). Before I got to the house I had already done my due diligence and had all the information they provided for me about their property. What makes this property a potential tricky situation is the fact that what they owe to the bank is right the with what houses in that area are selling for, if I cant sell the house for less than what they owe than this will turn into a regular sale and they will have to pay real estate commission and closing cost from their pocket and they’re not in a position to do so.
Mortgage Payoff Letter
They have also not paid the mortgage for about 9 months now so they probably have fees and late payments added to the top of their mortgage so I had to request a mortgage payoff letter from the bank that will tell me the amount the bank will require in order to satisfy the entire debt, that way I know exactly my sellers need to net on the sale of their house if this was an investment opportunity you will know the minimum amount will sell for. This letter will help me determine what my next move will be from here If the letter says they need $20K under market value I will sell as a regular sale and have my clients make some money at the end or if they’re at market value I will try to sell it as a short sale.
How to request it from the bank
In order for you to be able to get this letter you will either have to call the bank and have the homeowner ask for it themselves or have the homeowner sign an third party authorization form allowing you to communicate with the bank directly, I prefer the latter that way if I need to contact the bank again I can easily do it without having to get the homeowner on the phone every time.
There are other instances where you will need to request a mortgage payoff letter from the bank but this what it for me this week. If you have any questions or are facing a similar situation feel free to reach out to me via my contact me page.