Making Sense of Your Offer, Part 1
May 28, 2010

One of the interesting items that came about from the Treasury Department’s HAFA guidelines is that the investor (the lender) must “perform a financial analysis to determine if a short sale or DIL is in the best interest of the investor, guarantor and/or mortgage insurer.”  Over the years of doing short sales, I’ve always made that examination my responsibility in order to further demonstrate the validity of the offer I am submitting.  I call this examination a carry cost analysis, and it is one of those tools I have used with great success.

The Carry Cost Analysis is a compilation of the expenses an investor will incur once it stops getting paid by the borrower as well (lost principle/interest payments, taxes, etc.) as well as the associated expenses related to foreclosure.

Banks will do their best to preserve the condition of an asset if the borrower is no longer able to. In all cases the bank will incur many additional expenses once they take a property back in a foreclosure action. Many of the expenses will be related to property preservation, legal fees and other costs associated with the process of doing a foreclosure and preparing the home for the foreclosure process.

When a carry cost analysis is submitted with the short sale proposal, it will make the real estate professional’s job easier to present a more compelling case to the lender that a short sale is in their best financial interest as opposed to incurring the expense and work of a foreclosure.  It will also make it clear to the lender that you have done your due diligence and help your short sale proposal get considered well ahead of others.

The process to prepare a carry cost analysis can be overwhelming for many.  But by following a few simple steps the report falls into place rather easily. Foreclosure Guard will walk you through these steps and move you on the way to closing more short sales, generating greater wealth all while saving families in your community from the ravages of foreclosure. Get Foreclosure Guard today and receive the full detailed article and instructions on how to complete a powerful and effective carry cost analysis.

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