Negotiating with Loss Mitagators

Negotiating your short sale is not for the weak at heart. I hear a lot of new investors who spend months getting their short sale package in front of the decision maker and seconds backing up their offer when it is rejected. Here is a little secret for everyone. A Loss Mitagators job is to negotiate the highest price possible for the bank. If they feel your initial offer is fair they will still reject it. They do this to justify why the bank pays them in the first place. If they accepted every fair offer right away then they would serve little purpose. So expect your first offer to be denied. It is not a big deal. Keep in mind that the price of a property is whatever someone will buy it for. If the house was worth $200,000 in 2006 and it was recently appraised for $160,000 the bank thinks they are giving you a deal at $160,000. But what they don’t see from behind their computer is what will help you negotiate a lower price. Don’t be afraid to challenge them on every issue. If there are 10 other houses in foreclosure on the same street and the police have reported an increase in violence, nobody’s going to pay $160,000 for that house. What a house is appraised for and what a comp recently sold for means nothing to me or my offer price. I try paint in a picture, while negotiating, of a house worth $120,000 because that is what I believe the house is worth. A lot of new investors don’t know how to play the game with the banks. Do you think a Loss Mitagator cares about the house at all? His job is to negotiate and as long as he can prove to his supervisor that he has done that, his job is safe. So don’t be scared to challenge them if they say your offer is way too low, because it is only the first step in the negotiation process.

It’s a new day, new deal, new opportunity

Mike Sebeniecher, Texo Properties (TexoNC.com)