Check the feasibility of a short-sale approach before getting too involved. Short-sale investing occurs in the preforeclosure phase but not all preforclosure opportunities are short-sale opportunities.
David M. Petrovich, “The Short Sale Pro,” lays out the six basic steps to short sale success in his book, Short Sale an Ethical Approach:
1. Conduct a preliminary prequalification of the seller, the mortgage, and the real estate to demonstrate that it makes financial sense for the mortgagor and mortgage to agree that a short sale is in their best interest.
2. Gather information (field and empirical) for analysis and its manufacture into supportive data.
3. Prepare a compelling benefits-driver proposal.
4. Present that proposal to the appropriate body or individuals.
5. Negotiate terms for mortgagee’s approval.
6. Anticipate all obstacles, and then close the deal