For those interested in dealing in Preforeclosures and executing profitable Shortsales in 2005:

More and more banks are demanding a personal financial statement on the homeowner losing their house in preforeclosure and presumed to be working with a real estate investor like yours truly and attempting to execute a short sale.

The list of demands have gone from a line item description of all living expenses such as house payment, groceries, insurance, car payments etc. to the truly bizarre requests of the last two years of tax returns, W-2’s, pay stubs for the last six months for both the primary and secondary borrowers (for example husband and wife) who are on the mortgage and title.

I was at a dinner last night with Gold Plus members Nekter Lianakis and Nick Mackris at Mc Cormick & Schmick's in Troy, (their claim to fame is no refrigerator on premises - all seafood is fresh - delivered and cooked everyday - the rest is tossed away; very good seafood, definitely worth checking out) and the topic of preforeclosures and short sale came up. These 2 guys are the best I have ever seen when it comes to doing preforeclosures on the fly. I am trying to convince them to take a day off their insane schedule and come and teach everybody in my Inner Circle about how to execute Short Sales like clockwork.

Tentative date is somewhere in April - will keep you posted. But overall we both agreed that to play the game of short sales right now at a high profit margin level it is becoming more and more necessary to :

1. Get the homeowner completely and utterly on your side - it is no longer enough just to get the borrowers authorization in place like it used to be. We are talking stacks of documents - pay stubs, tax returns, living expenses - the whole gauntlet coming from the homeowners.

2. The wait to get an answer from the Loss Mitigation folks is getting longer and longer. Nothing devious on their ends just too many houses going into foreclosure right now.

3. Average time to execute a short sale has gone from 30 days to 90 days with 60 days just to get an appraisal ordered and completed from Loss Mitigation folks.

4. Good strategy is to keep the homeowner expectations on the realistic side especially if they are expecting some kind of payoff to hand over the deed to you. If that includes educating on the process of short sales well so be it.

But the payoffs are still huge - done properly short sales on preforeclosures can create an enormous amount of equity in a matter of weeks when there was none to be found when you started.

PS: Is wireless networking WIFI cool or what? I am sitting in Saige’s bedroom on the floor with my iBook, typing away with her lying next to me gurgling happily! This is the best $100 you can spend on a computer accessory this year.