Using the Web and social media to sell real estate

Commercial real estate short sales are a very complex process that is very different from the conventional short sale that we know from in the residential market.

Commercial short sales are much more complex than residential short sales.

First of all you are dealing with a very different type of bank, usually a local bank, who has very tight control on the loan it services and who also undergoes a tremendous quantity of scrutiny from the government.

These banks need to maintain certain performances and certain capital reserves and non performing loans are a definite threat to their survival. So the first thing they will do is trying to control the property before the foreclosure is through. A much more aggressive process.

Roberto Mazzoni

We continue the series of articles on commercial real estate investing by publishing two new videos where a qualified attorney explains how a commercial short sale works and how they can tie in with bankruptcy.

Learn how a commercial short sale can work.

You need to become creative in dealing with this new market in real estate.

eventually in boils down to “who do we have to deal with” from the bank viewpoint, and from the owner viewpoint it is a matter of making informed business decisions before it is too late.

Roberto Mazzoni

Standard credit channels have become much more difficult to navigate. US Banks today have much more stringent criteria that need to be met before they lend money for the purchase of a house and many buyers or investors cannot simply comply with these requirements.

The new Noteflo site for buying and selling loans.

There are six reason that could make your loan application fail with a regular bank:

1.The house won’t appraise for the price you are willing to pay. Some times banks will even reduce the value given in the appraisal, just to be on the safe side. The transaction will therefore fail either because the seller is not willing or able to lower the selling price or because the buyer is not able to come up with a bigger down-payment to offset the reduced appraisal.

2.You have a poor credit score. It is basically impossible to get any type of loan if you have a FICO score that is below 620, although the average of the credit score that is required today for conventional loans is often 700 or higher.

3. Too many debts already. You need to have enough money coming in every month to pay for the loan and any other debts you might have already. If you buy a new car just before applying for a loan you might be in trouble.

4.You have no stable job. It is usually required that you show at least 2 years of consecutive employment or two year of tax returns if you are self employed. Beware: if your tax return shows no profit or little profit, it is probably not going to work.

5.Too little down-payment. More and more US banks require that you come up with 20 to 30% down-payment when you buy a new house, unless you are getting an FHA loan which allows for a lower down payment but it is very strict with the appraisal and the inspection of the house. You need to have a roof that can live for at least another 5 years and a good furnace or air conditioning system, just to mention two of the main factors.

6.Deceitful information. If you try to cheat during the application process you will be thrown out.

This is creating a serious problem on the market and new solutions are coming up. One that is worth mentioning is the site Noteflo.com that proclaims itself to be “The Private Loan Marketplace”. It is a site that brings together lenders, buyers and investors. It has just been launched and there is only partial coverage of the various markets, but the idea is quite neat and it can fill a very definite demand from the market.

Roberto Mazzoni