Short Sale Magic -- Delaying The Sheriff Sale

By Author: Colin Egbert
Total Articles: 6
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Putting together a short sale package is time-consuming enough, but if you want to try and delay the foreclosure sale to give yourself more time you'll find that this aspect of short sale investing is difficult indeed. Even professional real estate investors who have spent years making deals, find that attempts at delaying the foreclosure process are frustrating.

Depends on the Level of Communication
The ease with which you are able to delay the Sheriff's sale depends on how well the homeowners have communicated with the bank during their downward spiral. If the homeowner in pre-foreclosure has just stuck their head in the sand and hoped that the problem would go away, you may have another bigger problem in getting the bank to delay the foreclosure sale.

Usually these types of homeowners have waited until it's too late anyway for you to do much good in their case. It may only be a week or two until the short sale and you'd need longer than that for negotiations and to gather the required foreclosure information for a short sale.

In short sale investing, you'll find plenty of homeowners who have ...
... been calling the bank about their mortgage and working hard to keep up payments or partial payments before the bank's loss mitigation officers were forced to file for foreclosure. These homeowners stayed in contact with their bank and kept lines of communication open. This makes it easier for you to request that the bank delay in filing for a foreclosure or delaying the sheriff's sale date.

Short Sale Tips to Delay Foreclosure
In short sale investing the fastest way to delay a foreclosure is by contacting the bank in charge of the homeowner's mortgage. If the homeowner has been ignoring their problems and not attempting to work with the bank, you need to open the lines of communication.

Attempt to stall that foreclosure by calling the bank in the homeowner's name. As the real estate investor you'll be the homeowner's mediator with the bank during the short sale negotiations. You could be the most reputable person to intervene with the bank's foreclosure filings. Call the bank's costumer service department or the bank officer you've already been working with and let them know you need a little more time to complete your short sale package. If you are contacting the bank for the first time on this pre-foreclosure let them know you are an investor and what your plans are for negotiating a short sale. This information alone may get the bank to grant you an extra thirty days before filing for a foreclosure.

The bank may also be so fed up with the homeowner's non-payment on the pre-foreclosure that they refuse to delay the foreclosure unless the payments are caught up on the mortgage. Some real estate investors will offer to catch up the past due payments in order to get the bank to cancel the foreclosure. Then, the investor just knocks those payments off of their offer price in the short sale deal.

Get that in Writing!
Even when you get the bank to delay or cancel the foreclosure, the property may still end up in the sheriff's sale. This happens when the bank officer fails to get into contact with the attorney handling that particular foreclosure and letting them know about the delay. As is the case with many problems, if you want something to get done, you've got to do it yourself!

Have the bank send you a signed written agreement for a foreclosure extension. Also ask the bank officer for the fax number of the attorney that is handling the mortgage foreclosure. Send a copy of that foreclosure extension to the attorney and then call that attorney to make sure they've gotten the extension.

Sadly, in short sale investing nothing is quite certain until money changes hands. Even with these extra precautions that house may still end up on the auction list through some fluke of luck. You'll want to call the court house after a few days to make sure that the property has been taken off of the property list.

Last Chance for a Foreclosure Extension
You may be able to get the attorney or the title company dealing with the foreclosure to call the bank and request an extension. Foreclosure extensions are granted for a variety of reasons, besides giving the homeowner's more time to catch up the past due amount or allowing an investor time to put together a short sale.

These ideas can work to help delay the sheriff's sale or get you a foreclosure extension from the bank. However, they may not always work and the attorney or the title company dealing with the foreclosure may not feel inclined to request more time from the bank for their own paperwork. If you can't get any of these tactics to work you may need to pull in some help in the form of a team of former loss mitigators.