Not all short sales give you plenty of time to carry out the deal. In fact you may have to hurry to try and delay sheriff sale auctions to give you more time to complete the short sale deal. This is a really difficult thing to do. Even professional real estate investors find that attempts at delaying the sheriff's sale are frustrating. So, there are no guarantees you'll succeed.
Whether or not you are able to delay Sheriff sales and foreclosure auctions depends on how well the homeowners have communicated with the bank before you came along. You may have a problem in getting the bank to delay the foreclosure sale, if the homeowner just stuck their head in the sand concerning their late payments.
You probably won't be working with many of these types of homeowners, as they have waited until it's too late for you to do much good in stopping their foreclosure and getting the bank to accept a short sale.
However, you'll still find plenty of homeowners who have been working hard to keep in contact with the bank's loss mitigation officers before they were forced to file for foreclosure. This makes it easier for you to request that the bank delay in filing for a foreclosure or delaying the sheriff's sale date as these homeowners stayed in contact with their bank and kept lines of communication open.
How to Stop a Foreclosure Sale and Delay Sheriff Sales
The fastest way to delay a foreclosure in short sale investing is by contacting the bank in charge of the homeowner's mortgage. You can attempt to stall that foreclosure by calling the bank in the homeowner's name. You'll be the homeowner's mediator with the bank during the short sale negotiations so this tactic isn't too outside the range of normal practice. You are probably the most reputable person to intervene with the bank's foreclosure filings on the homeowner's behalf anyway.
Call the bank officer you've been working with on the short sale and let them know you need a little more time to complete your short sale package. If you have yet to contact the bank to initiate the short sale process, do so now! Tell the loss mitigator you are an investor and your plan on negotiating a short sale, this may get the bank to grant you an extra 30 days before filing for a foreclosure.
However, the bank may be so fed up with the homeowners that they refuse to delay sheriff sales unless the payments are caught up on the mortgage. Some real estate investors do catch up the past due payments in order to get the bank to cancel the foreclosure, but if you aren't willing to do this then you've got a problem.
You may be able to get the attorney, bank's trustee or the title company dealing with the foreclosure to call the bank and request an extension for themselves. Of course, this isn't a guarantee and they'll need a good enough reason from you to go out of their way in making the request.
Getting a Foreclosure Extension in Writing
The property may still end up in the sheriff's sale even when you get the bank to get a delay sheriff sale. This can happen when the bank officer fails to get into contact with the trustee handling that particular foreclosure to tell them about the delay.
Ask the bank officer for the fax number of the attorney that is handling the mortgage foreclosure. Get the bank to send you a signed written agreement for a foreclosure extension. Send a copy of that foreclosure extension to the bank's trustee or attorney. Finally, call that attorney to make sure they've gotten the extension notice and you'll be able to relax just a little bit about the short sale auction.
Nothing is quite certain until money changes hands in business, especially in short sales investing. That house may still end up on the auction list even with these extra precautions. Some strange fluke may cause the house to end up at auction and you'll lose that house before you even get it! Be sure to call the court house after a few days and make sure the property has been taken off of the property list for the auction.
It is possible to delay sheriff sale auctions or get a foreclosure extension from the bank, but it's a frustrating process. These tips and ideas may not always work. Plus, the bank may not feel inclined to delay the foreclosure auction when you approach them. It's worth a try though, especially if you've found a short sale property that's going to bring in a large profit.
Colin Egbert is an experienced Real Estate Investor who can show you how to delay sheriff sales and auctions with ease. He's the author of the ebook “Getting Started with Short Sales" providing the tools needed to start your own real estate investing business. Colin is also the CEO of Realestateinvestor.com a website dedicated to helping investors make the most of their business.