How To Stop a Trustee's Sale NOW

I trust you guys will tell me the truth....

Do I have a sign around my neck that says "Call me if you're a homeowner in default with a trustee's sale scheduled in less than a week?" If I do, then I must also have a sign on my back that says "Kick me because I'm going after leads that I can't save."

In the last 2 weeks, I've dealt with homeowners with a trustee sale scheduled the next day, in 2 days, in 3 days and now have another one in one day (tomorrow). Couldn't save the last 3 because the lender had already postponed the trustee's sale once without a payoff and was a little pissed off. Pretty much ran into a stonewall no matter what I said after putting on my best debater hat.......

"I have a very strong cash offer that can close in 15 days..."
"You're going to lose far more $$$$ if the property forecloses..."
"This homeowner is in serious financial hardship. Just lost his job, death, etc. and all he's asking is for you to consider the offer presented?..."

If you research articles/blogs on the Web, most experts say that there's almost nothing you can do if you get within a 5-day window of the trustee's sale. However, I've talked to investors who've said they've stopped them within the last hour so I know it's possible. Anyway, I remember Josh Cantwell saying one option is to have the homeowner file for BK and then pull the BK off the table within 21 days. Seems pretty drastic.

I have some ideas for my latest case (Trustee's Sale scheduled for tomorrow at 11am)...

Got the call yesterday (New Year's Eve) at 5pm from a letter I had sent out to a Pre-NOD list. Two guys living in a beautiful 3,200 sqft. Craftsman home they restored in a hip area of Pasadena. The realtor on the property (who also lives in the house) gave me a call as a last ditch effort because my letter said I wanted to "buy your house" and got their attention because it was handwritten and seemed sincere. He said the trustee's sale was scheduled for January 3 and was willing to give me a shot to save it. Of course, I later confirmed that the trustee's sale was scheduled for January 2 with Wells Fargo being closed on New Year's day. Just fantastic, right?

Side note: I'm pursuing most anything these days because I've now learned that: 1) you never know what might be a good opportunity until you spend some time investigating and 2) it's a good learning experience for me dealing with homeowners and trying to make something happen. Maybe there's a last minute niche I got going here :-).

Anyway, I met the guys at the house at 8PM last night (New Year's Eve). GREAT house that just got certified as a historic landmark by the City of Pasadena, terrible lot (about 100 sqft. bigger than the house), no garage and located on a busy street. The property has been listed on the MLS since July at a price of $1.495MM with not much interest.....go figure. My best guess for a 30-day quicksale value (based on the comps) is about $825K.

So what's up with the high list price? Turns out the homeowner owes $950K to Wells Fargo and then $250K to Countrywide and was thinking he could make some extra cash with the sale of the property and roll it into another renovation project. I guess he should have actually looked at what the market was bearing :-)......Although, there have been a handful of $1MM+ homes sold in the area in the last 6 months.

After having them ask a lot of questions, sign all the paperwork and make copies of everything, I didn't get out of there until 11:15pm - just in time to drive by all the crazies camping out on the street in their armchairs for the Rose Parade the next morning. Ran some low comps this morning to include with the paperwork and wrote a cover letter with the following plea:

"This is a formal request for a pre-foreclosure short sale on the above referenced property. A very strong cash offer has been submitted on the property and is attached, but there is a pending trustee’s sale scheduled for January 2, 2009. We are asking that you postpone the trustee’s sale so you can do your due diligence in reviewing and evaluating the attached offer.

The property has been certified as a HISTORIC LANDMARK BY THE CITY OF PASADENA who has expressed interest that it NOT be foreclosed upon if at all possible. However, it has lost considerable value because the City would not let it be converted back into a duplex, deemed the parcel of land a “substandard lot” due to its very small lot size (3,292 sqft.) and busy street location, and will not permit a garage on the property.

The offer on the house is by a company on the Board of the Pasadena Cultural Heritage & Preservation Committee who has support to see the house preserved. Please consider this when evaluating the trustee’s sale postponement.

The homeowner, XXXXX, diligently pursued a loan modification with Wells Fargo months ago and was given the impression a workout plan would happen. Only in the last few weeks, did the loan modification get declined leaving him little time to pursue a short sale. We now have a strong cash offer on the house, relative to recent comparable sold historic homes, which the homeowner has accepted."

All above is true. This is in addition to my "URGENT" message and circles all over the fax cover page. I faxed everything into Wells Fargo (who is closed today) this morning with an offer price of $675,500. I'll let you know what happens tomorrow by submitting a comment to this post. Wish me luck with this case and better luck in the New Year reaching clients earlier in the process :-).