Before joining North Shore Enterprises (NSE) in 2004, Bob Lachance was a 4-year-collegiate-scholarship athlete in ice hockey at Boston University where he won a National Championship in 1995. After leaving BU he enjoyed a successful 8 year career as a professional hockey player. Upon retirement from hockey, Bob completed several profitable real estate rehab projects for his own benefit. He then joined NSE as an associate responsible for property acquisitions and loss mitigation/lender negotiations. Bob brought the same determination and work ethic that lead to great success in his professional sports career and thus generated more acquisitions and short sale acceptance letters in a shorter time frame than any associate before or since. His outstanding performance led to a promotion to partner in 2005. Since that time, Bob has taken responsibility for all the day to day operations of NSE. As partner, he has overseen the acquisition of, the loss mitigation, and the disposition of over four hundred properties. Bob continues to be directly responsible for identifying good candidates for acquisition and for overseeing bank negotiations, and has been essential to the success and growth of NSE.
Archive for Investing
The 3 Biggest Misconceptions That Real Estate Agents Have About Short Sale Listings
Posted by: | CommentsSan Diego Foreclosures For Sale
First of all, “yes” some short sales take long to sell and “yes” some short sale listings can be frustrating. But let me tell you this; not all are created equal! With a little patience and a little creativity you can overcome some of the shortcomings of listing pre-foreclosure/short sale properties and make a lot of money by helping homeowners get out from underneath the huge burden of debt and stress they are under.
Let’s deconstruct three of the biggest short sale myths:
Yes, it’s true when it comes to a short sale; the lender is in the driver’s seat. And since they hate to lose money they tend to reduce the amount of commissions by an average of 1%, meaning that if your area pays out 6%, they will only approve 5%, which will be split by both the agents involved in the transaction.
You know what I say to that? Who cares! Be creative! Did you know that there are 7 additional profit centers that can offset your 1% cut in commission? Let’s take a look at what they are:
The “Loss Mitigation Fee” is a fee that we collect only when we successfully negotiate a short sale and have the foreclosing lender pay for all of the closing costs (the realtor commissions, attorney/title company fees, conveyance taxes, etc.).
The average loss mitigator receives an average of 30 NEW files a day. Not a week, not a month but a DAY! That is part of the reason that short sales can take a while, but it isn’t the main reason. The primary reason is because the majority of real estate agents submit short sale packages that are less than adequate and professional! Meaning;
Those and many more reasons cause short sales to get hung up. Once again, take what the defense gives you. If loss mitigators are overwhelmed, then the key is to put together a professional and presentable short sale package guaranteed to get your short sale offer reviewed and approved.
With the right system they are not hard! Let’s take a look at how to overcome the two biggest reasons why short sales blow up right before the closing.
The key is not to have only one buyer but to have a pool of qualified buyers that are pre-approved. The best buyers to keep an eye out for are those that are already pre-approved and that have funds in place to make an actual purchase.
The two easiest ways to do that are: Start networking with every real estate agent that specializes in buyer’s representation. They are easy to find because it is in all of their advertisements. Start working closely with every single mortgage broker or direct lender that you know, or that one of your fellow agents knows.
In conclusion, listing pre-foreclosure/short sale properties can take some time to close. However; in this market everyone needs to stick together and help one another out. By building the right network of real estate professionals, we can all ensure that our listings (short sales or not) do not sit out there without a buyer!
For more real estate industry news and loss mitigation blogs and videos visit www.RealEstateBusinessMentors.com or visit www.AskBobLachance.com for any short sale bank negotiating questions.
Real Estate Investing Tips For Profit
Posted by: | CommentsSan Diego Foreclosures For Sale
Investing in real estate has long been considered as a safe and high return investment. “Flipping” in real estate investing has become very popular over the last few years especially among the speculative real estate investors. Flipping refers to the buying and selling of real estate property within a short period for quick profits. Though the return on investment appears to be good, there is still a risk that your money could get locked-in in the absence of buyers.
Real estate prices have steadily increased since the beginning of this decade. However many signs point to the real estate boom coming to an end, so it may be wise to put real estate investing on hold. Investing in real estate, contrary to popular thinking, is a slow yielding investment. Hence real estate investors need to do proper planning and to conduct market analyses before investing.
Before investing in any property it is vital to study all the related documents of the property, to see the license of a broker if any, to check for liabilities etc. All contracts have to be in writing. All details such as the names of all parties, address of the property, area, purchase price, consideration etc. have to be entered in the contract along with all parties’ signatures. It is also prudent to hire a property lawyer to look into the intricacies of real estate contracts.
One good way of investing in real estate is to buy foreclosure properties. Foreclosure is the process in which a bank or a creditor sells the property of the homeowner to recover the loan, which the owner has not been able to pay back.
A lease to purchase contract is considered the best type of real estate investing. This type of contract basically allows the tenant to lease a particular property for some period, and at the end of the period he has the option of purchasing the property at an amount decided at the signing of the contract. The tenant pays an initial non-refundable deposit. If the value of the property goes up at the end of the leasing period, the he may want to buy the property at its original value. If the value has not increased he can opt not to buy it. During this period he can also rent the property to someone else. By this method, the investor takes a lot of the risk off himself as he does not have to commit a large sum of investment capital not apply for a big loan.
Currently, there are a few areas where the real estate market is just too overheated and investing in real estate is just too risky. They are Miami, Las Vegas, Northern Virginia, Phoenix, Sacramento, Boston, Washington DC, and San Diego. Other “hot” areas also include San Francisco, Chicago, New York, Los Angeles, and Seattle. The safer, less volatile areas for investing with good ROI are Dallas, Cleveland, Houston, Columbus, Omaha, Kansas City, and Pittsburgh.
Are Foreclosure Homes a Smart Buy?
Posted by: | CommentsSan Diego Foreclosures For Sale
The number of homes facing foreclosure continues to grow in many parts of the country. The consensus among ordinary citizens seems to be that a fortune can be made buying foreclosure homes. Is that true or false? The truth is – it’s some of both.
Three and a Half Ways To Buy Foreclosure Properties
Buying real estate foreclosures only produces profits for those who have the knowledge required to recognize and negotiate profitable deals. With foreclosures that’s not as easy as it might seem.
Preforeclosure
The preforeclosure period offers the greatest opportunity for the novice investor. Preforeclosure can be divided into two periods. The first is where a financially distressed home owner realizes he or she will soon be unable to stay current with their mortgage payments.
If you can reach the owner during this period you have a chance to buy the home in the normal way. That is, make your deal with the home owner, get a mortgage loan and go to the close.
Ah, but how do you reach that owner. You target a housing development that first began selling new homes about three years ago. You do that because many adjustable rate mortgages reset to a much high interest rate after three years. As that date approaches many home owners begin to realize they have a problem.
You blanket that development with flyers every 30 to 60 days advertising yourself as a home buyer . Once a week you spend a Saturday afternoon going door to door and asking “Are you the folks that are planning on selling your home? No? Let me leave my card in case you change your mind.”
The second part of the preforeclosure period is at some point after the homeowner has stopped making mortgage payments and the lender has filed a notice of foreclosure (sometime called a notice of default). Now the clock is running and you must move quickly to make your deal before the lender takes the home.
The owner could be as much as six months behind in mortgage payments. You’ll need cash to bring those payments current and stop the foreclosure.
The catch is that many of these homes were purchased as real estate values peaked. Now home values are falling and the home is worth less than the amount due on the mortgage loan. The owner is “up side down” and there is no equity and no profit for you.
If there is equity you have a chance to make a good buy. There is seldom enough time to apply for and qualify for a mortgage loan. You will either need cash or the ability to strike a deal using a lease-option or to buy “subject to” the existing financing. You will need a thorough understanding of those tactics to use them profitably.
Foreclosure Auction
Your next chance to buy is at the foreclosure auction sale. Auctions are cash-on-the-spot sales. Yes, you will need cash, but even more important is the ability to research the property being sold to determine if it would truly be a profitable buy.
Many foreclosure homes have been trashed and stripped. What will the cost of rehab be? How’s the neighborhood? Is it safe to go in unarmed? Are there zoning or building permit issues attached to the property. Foreclosure auctions are not a game for the inexperienced investor.
Now we have listed the first two opportunities to buy foreclosure homes:
1. During just before a foreclosure.
2. At the foreclosure auction.
Bank Owned Homes
Opportunity number three is homes owned by the bank. These are often called REOs for real estate owned.
If there are no successful bidders at the foreclosure auction the home becomes the property of the bank. When there are many foreclosures banks end up owning thousands of homes they do not want. If you have the cash they will listen to offers. If the bank is eager to get those homes off of their books they may consider financing your purchase if you have a decent credit history. Often they want cash.
You can put together a group of investor who pool their funds to bid at foreclosure auctions or buy REOs.
Redemption
I promised three and a half ways to buy foreclosure homes, so here’s the half. In some states the owner has redemption rights. That means during a certain number of months after they have lost their home at the foreclosure auction they can regain ownership.
To redeem they must pay all money that was owed on the mortgage, pay all the costs of the foreclosure and pay any interest that accrued during the redemption period. It is sometimes possible to buy the redemption rights from the displaced owner, cover all the costs and own the home.
What about the investor who bought the home at the auction? He or she has our most sincere sympathy.
That’s it, three and a half ways to buy foreclosure homes. There’s money to be made, but you will earn every nickel!
Understanding Foreclosure
Posted by: | CommentsSan Diego Foreclosures For Sale
Hi, this is Emil from http://investing-in-property.com.
I hope you’re going to enjoy the following article on investing in real estate. If you want to know more visit my website.
The recent collapses in the mortgage industry have left a large number of consumers scratching their heads in an effort to better understand the economics behind borrowing money. From the opposite side of the spectrum, this rash of foreclosures has left many savvy real estate investors scratching their heads trying to figure out how they can make money from the foreclosed properties. Though the processes can be lengthy and rather complicated, the best place to start is with a basic understanding of how foreclosure works, and what it actually means.
Foreclosure is simply the act of a bank, mortgage company, or anyone else who loaned you money for your house saying, “We loaned you money and you aren’t paying us back in the way that we agreed. As a result, the loan is cancelled. Pay us now.” Most people cannot repay the loan immediately so the house is claimed as collateral. This process can take several different forms.
The first is judicial foreclosure. Judicial foreclosure involves the court system. This is the most common type of foreclosure, and in many areas it is the only legal option of foreclosure available. The court system will oversee the sale of the foreclosed property and the money made from the sale will go to pay back the bank or mortgage company. If there is any money left over, it will be used to pay off any liens that may be held against the property. Liens are claims that other creditors may place against your property. The lien is a legal agreement that says. “Party A owes me money, so if they decide to sell their house then they don’t get any of the money until the debt to me has been paid in full.” After all the creditors and lien holders are paid, the original homeowner will get whatever is left.
The second type of foreclosure is non judicial foreclosure. Also known as “foreclosure by power of sale,” this is the preferred method by most creditors because the process tends to move much faster than court supervised foreclosure. This method is not legal in every state. The distribution of funds follows the same schedule as the court supervised foreclosures, with the original homeowner finally getting whatever proceeds of the sale are left at the end.
If you are an investor seeking to take a 2nd mortgage and buy foreclosed real estate, then you will quickly become familiar with the term, lis pendens. This is a Latin phrase meaning “pending lawsuit.” In the world of mortgages and foreclosures, it is a publicly recorded list of properties that are about to foreclose. Once the process has begun for judicial foreclosure, the municipal clerk in your county or town will publish the list of suits that have been filed. This is a great place to look for real estate investors who may be able to buy homes directly from people who are about to go through foreclosure. It is a chance to pick up property for a good price and for them to avoid going through the foreclosure process.
Before a suit is filed, the creditor is required to issue a Notice of Default. This is a legal notice that informs you, the borrower, that your original loan is in default status and that the original agreement that was established for payment is no longer binding. Most lenders will place a mortgage into default status when the payment reaches the point of being 90 days late. By day 95, the Notice of Default will have been presented to you. If you have a default loan you may still be able to salvage your home, but you will need to act quickly.
As a real estate investor, there are two different ways to buy distressed properties. The first is to purchase pre-foreclosure properties. It is pre-foreclosure because the property still belongs to the original homeowner. Though proceedings for the foreclosure may be underway, the homeowner may be willing to sell the property for just enough to satisfy the amount of the loan. This leaves the investor with a great deal on a piece of property and the homeowner avoids the traumatic experience of foreclosure. Foreclosure property sales that are not “pre” have already reached the point where the property is back in the banks name and they are selling it just to see how much they can recover. Again, this is a great opportunity to buy, as the banks often don’t push for higher prices at auction. They simply want to recover the outstanding portion of the loan.
The increase in sheer volume of foreclosure is evidence that many people simply do not understand what they are getting into when they buy their first home. Having identified this as a problem, there are many government back institutions and even some private ones, who offer assistance to home buyers. While they can help you secure funding, organizations like VA/HUD, Freddie Mac, and Fannie Mae are also excellent sources of information.
The Key to Getting Your Pre-foreclosure/short Sale Listings Closed
Posted by: | CommentsSan Diego Foreclosures For Sale
“Following Up” is your key to short sale success! Following up on every aspect of your short sale is one of the most crucial parts of a short sale. If there was one thing that, above all, needed to be done well in order to ensure success, it would be following up. Because a short sale has several different pieces that all come together at various points in time, it follows that there are many people and parties to follow up with as you work through the process.
Who are you following up with?
When working on a short sale, there are three main parties that you are involved with: the lender(s), the homeowner, and the buyer’s real estate agent. At different points throughout the short sale process, you may need to follow up with one, two, or all three of these parties at the same time. In the beginning it will primarily be the homeowner, however as the short sale continues to move along, you’ll be following up more heavily with the lender and buyer’s agent to keep the buyer in the loop with the status of the short sale.
The Three Parties… You will be in direct contact with the homeowner to obtain the documents to send to the lender and you’ll also need to be in touch with them when it comes time to drop the list price on their home as well as when it comes time to close on their property. It is also very important to stay in contact with the homeowner to keep them updated on the status of the short sale negotiations.
The lender is the primary party that you’ll be following up on from the beginning to the end. From the initial call right up through closing you’ll be on the phone with the lender, always following up on your most recent fax, email or phone call. Depending on which lender it is that you’re dealing with, you may be following up with any number of different employees throughout the course of the short sale. You may find yourself calling customer service representatives, loss mitigators, set-up representatives, managers or supervisors, and occasionally collections.
When trying to reach someone directly, always be alert to the possibility that the person you are trying to reach is not the correct person to be speaking to. It is quite possible that you received some misinformation and have been trying to reach the wrong mitigator. Remember, you are dealing with employees that could care less or perhaps are completely clueless. There have been a few instances where I was given a name and told that that a particular person was the assigned loss mitigator. After three weeks of leaving multiple messages, I hadn’t heard a peep from the “supposed” mitigator. In need of a definitive update, I called the loss mitigation department and spoke to a different person who told me that the file had been assigned to someone else.
Be prepared to do that yourself. If you go a couple of weeks without hearing back from the person in question, try calling and speaking to the department of which your designated party belongs to and clarify the situation. If you speak to someone different, chances are they will clear up some misinformation that you had received prior. Keep digging, and you will get to the right person. And while there are some important matters to attend to regarding the homeowner and real estate agent, the lender is who you’ll spend 80% of your follow up time with.
Another important party to follow up with is the buyer’s agent. They need to be updated on a constant basis, and it will greatly benefit you if they are well versed in short sales, because then they will understand the nature of the situation they are involved in and be able to reassure their client to be patient. The success of the short sale, and its 100% conclusion, is based largely on the buyer cooperating and sticking around, and so you’ll want to make sure that you set their expectations very clearly from the beginning! How to keep everyone updated without having to make follow up calls every single day…. The best way I found to cut down having to make follow up calls every day is an online short sale management tool called managemyshortsale.com. This has taken a huge weight of my shoulders because it allows me to keep everyone in the loop on what the status of my short sale negotiations. As soon as I speak to the foreclosing lender and I update the account it automatically sends an email notification to every party involved in the short sale process (Homeowner, Buyers Agent, Attorney, Mortgage Broker, etc).
View more articles about the preforeclosure industry and investing in real estate at http://www.realestatebusinessmentors.com
Visit www.AskBobLachance.com for any short sale bank negotiating questions.
Before joining North Shore Enterprises (NSE) in 2004, Bob Lachance was a 4-year-collegiate-scholarship athlete in ice hockey at Boston University where he won a National Championship in 1995. After leaving BU he enjoyed a successful 8 year career as a professional hockey player. Upon retirement from hockey, Bob completed several profitable real estate rehab projects for his own benefit. He then joined NSE as an associate responsible for property acquisitions and loss mitigation/lender negotiations. Bob brought the same determination and work ethic that lead to great success in his professional sports career and thus generated more acquisitions and short sale acceptance letters in a shorter time frame than any associate before or since. His outstanding performance led to a promotion to partner in 2005. Since that time, Bob has taken responsibility for all the day to day operations of NSE. As partner, he has overseen the acquisition of, the loss mitigation, and the disposition of over four hundred properties. Bob continues to be directly responsible for identifying good candidates for acquisition and for overseeing bank negotiations, and has been essential to the success and growth of NSE.