1. Short Sales in 2013
…. and Beyond!
How to profit from one of the BIGGEST
trends in Real Estate History

2. Why Short Sales?
• Experts are predicting that 2013 will be the “Year of
the Short Sale”
• Past Due Mortgages = 6,298,000
• Home Prices are slowly increasing nationwide
• Close to 30% of ALL homes are “underwater”
• Most agents still run the other way
• Become your “local area expert” and Cash In

3. Common Agent Objections
• It’s hard to find a buyer for a short sale
• They take too long
• By the time we get the approval, the buyer walks
• The bank wants too much money
• I don’t have the time to become a negotiator and sit on-
hold all day with the bank
• They cut my commission anyway

4. Common Agent Objections
• I don’t know how to negotiate a short sale properly
• What is the difference when negotiating an FHA loan vs.
conventional?
• What about a Jumbo loan, or a VA loan?
• How do I handle 2nd mortgages, lines of credit, etc.?
• What do I do about other judgments and liens that come
up such as mechanic liens, HOA liens, child support
judgments, alimony judgments, credit card or other debt
instrument judgments?

5. Common Agent Objections
• What do I do when:
• They want a cash contribution from the seller and they
don’t have it?
• They want the seller to sign a promissory note?
• They won’t give a full-satisfaction and will only “release
the lien”?
• How do I handle the tax ramification/1099-C issue should
it arise?

6. Investor Based Solution
• The GOOD NEWS is that you NEVER have to worry about
any of those things ever again!
• You don’t need to learn every possible thing there is to
know and every way to negotiate the hundreds of
different scenarios out there when dealing with short
sales!
• Your investor team will handle all of this
for you….at NO CHARGE ever to either
the agent or the homeowner!

7. Investor Based Solution
• Investor puts in “cash” offer as soon as you get the listing so
that negotiations with the bank can begin immediately….a great
selling point for your prospects to bring a buyer upfront!
• Investor’s experienced negotiating team will handle all bank
negotiations….NEVER have to talk to the banks again!
• Average short sale closing average for agents nationwide is
around 30%.
• Our team closes 90%+ of every deal we work on

8. Investor-Based Solution
• Property is actively marketed only after
the bank counter-offers
• Property can now be marketed as a
“bank approved short sale”
• Buyers that are identified later in the
process are much less likely to “walk”
as their wait time is normally less than
30 days.
• When negotiated properly,
commissions are almost always a full
6%

9. Resale Process
• Homeowner (Owner of Record) = Party A
• Investor Buyer = Party B
• End Buyer = Party C
• Initial contract is the A > B. The homeowner grants the
investor an “equitable interest” in the property allowing
them to negotiate with their bank, lien-holders, etc.
• In addition, they are granted the right to list, market for
sale, and sell the property while negotiating and prior to
purchasing from owner of record.

10. Resale Process
• Entire process and each possible scenario is fully
disclosed in writing to ALL parties…including the banks
• Any offers that come in are presented to the
investor/buyer as they are now the ones legally selling
the property (B > C).
• Once the approval letter is in-hand the decision is made
whether to purchase (A > B) and re-sell (B > C) or to use
one of the following exit strategies

11. Exit Strategies…
and Realtor Compensation
• A > B, B > C … Immediate buy/sell (Realtor is paid on both
transactions on same day….earning double commission)
• A > B, B > C … Buy/Hold/Rehab (Realtor is paid on 2nd
transaction no matter how much time goes by during the
waiting and/or rehab period)

12. Process (A > C)
• More and more bank short sale approval letters are
including language that prohibits the re-sale of the
property for 30, 60, or even 90 days
• If there is already a “C” buyer lined up and ready to go, it
normally makes more sense for the investor to “release”
their interest and consequent contract with the owner of
record so that the “C” buyer can purchase direct from the
owner of record

13. Process (A > C)
• The Realtor is compensated by getting their full
commission (whatever the bank agreed to pay)
• The investor is compensated from the buyer by getting a
“Release of Contract” fee.
• This fee is the difference between what the bank accepted
and what the “C” buyer was under contract to pay while
buying from the investor.

14. Process (A > C) Example
For example:
•If the B > C contract was for $160k
•And the bank approval was for $150k
•The amount of the release would be $10k
•The owner of record (A) would then contract in place of
the investor (B) for the bank- approved $150k
•The total price to Buyer (C) therefore would not change at
$160k

15. Process (A > C)
• The possibility of the transaction going A > C is fully
disclosed to the bank as well as to the buyer once the
offer comes in.
• They know upfront that this could go A > B, B > C or
simply A > C, but regardless their end price will not
change or be increased 1 penny due to the investor
involvement

16. Process (A > C)
• The release fee is a separate transaction and has nothing
legally to do with the new contract between the owner of
record and the buyer
• Therefore is does not appear on the HUD-1 and complies
with RESPA terms and ALL bank approval letters
• If in the event the buyer needs to “mortgage” that amount
as they do not have the cash on hand, it can be added on
the HUD-1 as a buyer side closing cost (debit) as long as it
is OK with their lender

17. Conclusion
Realtors working side-by-side with
investors in this model will:
•Increase their amount of listings as they
can attract more sellers; bringing not only
a buyer but a proven team of negotiators
to help them
•Close more deals and focus on the things
that make them money…which is buying
and selling homes
•NEVER have to talk to or deal with the
banks again

18. Conclusion
• Stop worrying about the buyers “walking”
• Stop worrying about the bank BPO/Appraisal coming in
too high
• Start making more $$$ than ever before and take
advantage of what truly is a once-in-a-lifetime opportunity
for those smart enough to “see it”!!!!!
Contact James N. Graham
Sunburst Redevelopment LLC
(800) 450-2595 or
Email: james@sunburstbuyshouses.com
We will work in any state…
Take Action Now!! Call Us!