Short Sale CONTRACT FAQ's
Here are the most frequently asked questions about the GPS Short Sale Contract. If you have others, just give us a call
so we can help. These and more questions are available in a "Dear Buyer" Letter you can download/print by clicking
here: DEAR BUYER LETTER
1) Who pays the GPS Loss MItigation Fee?
GPS’s primary source of income is via “Loss Mitigation Service Fees”. GPS Fees are expected to be paid by Seller
Concessions, therefore GPS Short Sale transactions are structured such that even though the GPS Fees will appear
on the BUYER’s side of the HUD, these fees are offset by the Seller’s Concessions (from the Seller’s Lenders) which
appear on the Seller’s Side of the HUD. What this means is that GPS Fees are essentially paid by the Seller’s
Lenders as a “closing cost” – as a result, normally there should be NO cost to the Buyer for having GPS negotiate
the short sale.
In order to have a GPS Negotiator work on your behalf, both the Buyer and the Seller will formally agree by
completing the GPS Buyer's Agreement Form (located within the GPS Dear Buyer Letter). This document specifies
that GPS will control Seller Closing Costs (up to 6%) in order to ensure compensation for GPS's negotiation efforts. It
is important to note the GPS does NOT receive any payment of Seller Concessions unless the deal actually is
approved and closes.
Why do I need GPS to be involved anyway?
As a professional negotiation firm, the value of working with GPS occurs when you are able to employ GPS’
professional negotiation expertise on your behalf to INCREASE your chances of getting the deal accepted for at a
price approvable by the Seller's Lenders. You don’t NEED GPS in order to do a short sale. You and/or your realtor
can do it on their own, however the fact is that by working with an experience Loss Mitigation Firm like GPS, you’ll have
a much better chance of getting your deal accepted! Isn’t that the whole point?
The amount of the GPS Fee is based on the contract purchase price, to determine the amount for your contract,
please click here: What does it Cost?
So just how much does GPS make off of each deal?
Unlike most short sale “investors” or other “loss mitigation firms”, GPS believes in full disclosure. We make no
attempt to hide any of our fees from any party. Experience and success has proven that GPS provides a valuable
service to all parties (the buyer, the seller, the realtors, and the banks), as such we know that our fees are fair and
reasonable and we are happy to explain them.
>In general, the normal amount of the GPS Negotiation Fee is equal to a flat fee which is covered by a Seller
Concession of 3-6% (rounded down to the nearest $100 increment). Range pricing is used in order to account for
factors such as the length of time file must be worked by GPS, the bank itself (some lenders are more difficult to
negotiate with due to time/skill involved in managing their processes), amount of the contract, time until Foreclosure
Sale Date, etc, etc.
>As an example, on a $200,000 home, if the seller’s lender approved a 3% Seller Concession, GPS would expect to
be paid a fee of $6000.
>When you consider that most short sale “investors” and other so-called “loss mitigation firms” are attempting to
buy and flip short sale homes in the hopes of making $10-50,000 in HIDDEN profits on a “double close” or similar
transaction, we believe it becomes clear that GPS’s fees are indeed fair and reasonable for all parties. From the Buyer’
s perspective, being able to utilize GPS’s professional negotiators to increase your odds of getting an Approval so you
can purchase the home you want, should be a big benefit. GPS is not attempting to “make a killing” on any one deal or
to take advantage of any party. As an organization based on Christian values, we believe in providing a valuable
service in exchange for a fair compensation amount. We hope that you believe this is reasonable, too.
2) Are there any exception to the “No Cost to the Buyer” Rule?
Yes, there are 2 exceptions. In most deals, neither exception is activated, however you should be aware of them:
a) In order for GPS to begin the negotiation process with the seller’s lenders, the Buyer must place a (minimum)
deposit into escrow once the Buyer and Seller both sign/agree on the Purchase Contract. The Buyer’s deposit ensures
the Buyer is serious about purchasing the home and provides some protection for GPS’s negotiation efforts. If the
short sale is approved and the Buyer proceeds to closing, the amount of the Buyer’s Deposit will be applied towards
the Purchase Price (as in any normal real estate transaction). HOWEVER, if GPS secures an Approval Letter from ALL
lien holders for the amount of the Buyer’s Purchase Contract, BUT the BUYER decides not to close (i.e. Buyer
Defaults), then the Buyer’s (minimum) Deposit monies will be given to GPS as compensation for negotiating the
Approval. This is the ONLY time the Buyer would lose their deposit money to GPS.
The following chart will provide the amount of the Buyer’s Minimum Deposit.
Contract Price: Buyer's Minimum Deposit:
$249,999 or less $1500
$250,000 to $499,999 $2500
$500,000 to $749,000 $3750
$750,000 to $999,999 $5000
$1,000,000 or greater (individual case basis)
b) The only other exception to the “No Cost to Buyer” Rule is as follows: most lenders are willing to pay “Seller
Concessions” or similar fees (which again are used to pay the GPS Service Fees). However, some lenders and/or
their investor backers may decline to cover these fees. If the lender declines to pay such fees, the BUYER will be faced
with a choice: they can either choose to walk away from the deal or else make up the difference in the GPS Fee –
in which case the Buyer would be expected to pay the “minimum” GPS Fee amount which is equal to DOUBLE the
amount of the Buyer’s Minimum Deposit shown in 3-a above. In the event this occurs, GPS recommends that the
purchase price be raised to cover the remaining fee or the buyer can simply add it to their closing costs. In the end, the
Buyer is still getting the home for a great price. Thus it's still a win-win.
3) How much should the Buyer Offer?
Because short sales tend to take an average to 60-90 days to get an answer from the lender, if time is of the essence
to you, then you’ll want to submit your highest and best offer immediately. GPS will negotiate at your one and only offer
immediately in an effort to speed up the process.
If the bank accepts your contract... then you can proceed to closing. If the bank declines or counters your offer, then
you have the choice to simply walk away or increase your offer. If you choose to walk away because the bank declined
your offer, then your contract will be closed and you will receive back any deposits they placed in escrow. If you choose
to increase your offer vs the bank’s counter, you’ll simply work up a new contract and GPS will work for an approval on
that contract; if/when accepted, then you’ll move to closing.
4) Are there any special forms the Buyer needs to complete in order to work with GPS?
Yes, in addition to providing a Purchase Contract, you’ll need to include a Buyer’s “GPS Agreement Form” – which is
included in Section 3 of the Dear Buyer Letter.
5) What is a “Proof of Funds” Letter?
If the Buyer requires Financing, an Mortgage Approval Letter must accompany all offers. If the Buyer is paying “all
cash”, then a Proof of Funds Letter must accompany the offer. In all cases, GPS and all lien holders must be able to
verify the Buyer’s financial ability to complete this purchase.
If you need financing, GPS may be able to refer you to a mortgage broker for help. Just let us know.
6) Who chooses the Title Company?
To ensure a smooth closing on this short sale transaction, GPS prefers to work with title companies experienced with
these types of sale situations. Therefore GPS recommends the following firm if you are closing a deal in
FLORIDA: Elite Title
This is not a requirement, but it is encouraged – GPS makes no money from any associations with any title
companies, this stipulation is simply to ensure that the deal closes and everybody leaves the closing table happy with
the results!
NOTE: If you choose not to use this company, you will need to have your title company provide GPS with a
preliminary HUD to accompany your offer. This serves two purposes: first, it is required by the lenders with all short
sale offers. And second, GPS needs to be able to verify that the Buyer has made their minimum deposit into escrow.
8) Who pays the Closing Costs?
In general, the Buyer will be expected to pay any closing costs associated with recording the deed and title closing, any
costs associated with buyer-financing, and the GPS Service Fees (but remember, these should be offset by the Seller
Concessions). Thus, in the STANDARD short sale, the SELLER’s Side will normally be paying most closing costs
for both parties (including unpaid taxes, liens, etc).
>Please see Section 4 of the Dear Buyer Letter for a Sample HUD to learn more.
HAVE OTHER QUESTIONS?
Please send us an email at gps@genesispropertysolutions.org or give us a call at 888-GPS-LLC7 and let us help
you.
On behalf of the employees of GPS, thank you for the opportunity to work with you.
Here are the most frequently asked questions about the GPS Short Sale Contract. If you have others, just give us a call
so we can help. These and more questions are available in a "Dear Buyer" Letter you can download/print by clicking
here: DEAR BUYER LETTER
1) Who pays the GPS Loss MItigation Fee?
GPS’s primary source of income is via “Loss Mitigation Service Fees”. GPS Fees are expected to be paid by Seller
Concessions, therefore GPS Short Sale transactions are structured such that even though the GPS Fees will appear
on the BUYER’s side of the HUD, these fees are offset by the Seller’s Concessions (from the Seller’s Lenders) which
appear on the Seller’s Side of the HUD. What this means is that GPS Fees are essentially paid by the Seller’s
Lenders as a “closing cost” – as a result, normally there should be NO cost to the Buyer for having GPS negotiate
the short sale.
In order to have a GPS Negotiator work on your behalf, both the Buyer and the Seller will formally agree by
completing the GPS Buyer's Agreement Form (located within the GPS Dear Buyer Letter). This document specifies
that GPS will control Seller Closing Costs (up to 6%) in order to ensure compensation for GPS's negotiation efforts. It
is important to note the GPS does NOT receive any payment of Seller Concessions unless the deal actually is
approved and closes.
Why do I need GPS to be involved anyway?
As a professional negotiation firm, the value of working with GPS occurs when you are able to employ GPS’
professional negotiation expertise on your behalf to INCREASE your chances of getting the deal accepted for at a
price approvable by the Seller's Lenders. You don’t NEED GPS in order to do a short sale. You and/or your realtor
can do it on their own, however the fact is that by working with an experience Loss Mitigation Firm like GPS, you’ll have
a much better chance of getting your deal accepted! Isn’t that the whole point?
The amount of the GPS Fee is based on the contract purchase price, to determine the amount for your contract,
please click here: What does it Cost?
So just how much does GPS make off of each deal?
Unlike most short sale “investors” or other “loss mitigation firms”, GPS believes in full disclosure. We make no
attempt to hide any of our fees from any party. Experience and success has proven that GPS provides a valuable
service to all parties (the buyer, the seller, the realtors, and the banks), as such we know that our fees are fair and
reasonable and we are happy to explain them.
>In general, the normal amount of the GPS Negotiation Fee is equal to a flat fee which is covered by a Seller
Concession of 3-6% (rounded down to the nearest $100 increment). Range pricing is used in order to account for
factors such as the length of time file must be worked by GPS, the bank itself (some lenders are more difficult to
negotiate with due to time/skill involved in managing their processes), amount of the contract, time until Foreclosure
Sale Date, etc, etc.
>As an example, on a $200,000 home, if the seller’s lender approved a 3% Seller Concession, GPS would expect to
be paid a fee of $6000.
>When you consider that most short sale “investors” and other so-called “loss mitigation firms” are attempting to
buy and flip short sale homes in the hopes of making $10-50,000 in HIDDEN profits on a “double close” or similar
transaction, we believe it becomes clear that GPS’s fees are indeed fair and reasonable for all parties. From the Buyer’
s perspective, being able to utilize GPS’s professional negotiators to increase your odds of getting an Approval so you
can purchase the home you want, should be a big benefit. GPS is not attempting to “make a killing” on any one deal or
to take advantage of any party. As an organization based on Christian values, we believe in providing a valuable
service in exchange for a fair compensation amount. We hope that you believe this is reasonable, too.
2) Are there any exception to the “No Cost to the Buyer” Rule?
Yes, there are 2 exceptions. In most deals, neither exception is activated, however you should be aware of them:
a) In order for GPS to begin the negotiation process with the seller’s lenders, the Buyer must place a (minimum)
deposit into escrow once the Buyer and Seller both sign/agree on the Purchase Contract. The Buyer’s deposit ensures
the Buyer is serious about purchasing the home and provides some protection for GPS’s negotiation efforts. If the
short sale is approved and the Buyer proceeds to closing, the amount of the Buyer’s Deposit will be applied towards
the Purchase Price (as in any normal real estate transaction). HOWEVER, if GPS secures an Approval Letter from ALL
lien holders for the amount of the Buyer’s Purchase Contract, BUT the BUYER decides not to close (i.e. Buyer
Defaults), then the Buyer’s (minimum) Deposit monies will be given to GPS as compensation for negotiating the
Approval. This is the ONLY time the Buyer would lose their deposit money to GPS.
The following chart will provide the amount of the Buyer’s Minimum Deposit.
Contract Price: Buyer's Minimum Deposit:
$249,999 or less $1500
$250,000 to $499,999 $2500
$500,000 to $749,000 $3750
$750,000 to $999,999 $5000
$1,000,000 or greater (individual case basis)
b) The only other exception to the “No Cost to Buyer” Rule is as follows: most lenders are willing to pay “Seller
Concessions” or similar fees (which again are used to pay the GPS Service Fees). However, some lenders and/or
their investor backers may decline to cover these fees. If the lender declines to pay such fees, the BUYER will be faced
with a choice: they can either choose to walk away from the deal or else make up the difference in the GPS Fee –
in which case the Buyer would be expected to pay the “minimum” GPS Fee amount which is equal to DOUBLE the
amount of the Buyer’s Minimum Deposit shown in 3-a above. In the event this occurs, GPS recommends that the
purchase price be raised to cover the remaining fee or the buyer can simply add it to their closing costs. In the end, the
Buyer is still getting the home for a great price. Thus it's still a win-win.
3) How much should the Buyer Offer?
Because short sales tend to take an average to 60-90 days to get an answer from the lender, if time is of the essence
to you, then you’ll want to submit your highest and best offer immediately. GPS will negotiate at your one and only offer
immediately in an effort to speed up the process.
If the bank accepts your contract... then you can proceed to closing. If the bank declines or counters your offer, then
you have the choice to simply walk away or increase your offer. If you choose to walk away because the bank declined
your offer, then your contract will be closed and you will receive back any deposits they placed in escrow. If you choose
to increase your offer vs the bank’s counter, you’ll simply work up a new contract and GPS will work for an approval on
that contract; if/when accepted, then you’ll move to closing.
4) Are there any special forms the Buyer needs to complete in order to work with GPS?
Yes, in addition to providing a Purchase Contract, you’ll need to include a Buyer’s “GPS Agreement Form” – which is
included in Section 3 of the Dear Buyer Letter.
5) What is a “Proof of Funds” Letter?
If the Buyer requires Financing, an Mortgage Approval Letter must accompany all offers. If the Buyer is paying “all
cash”, then a Proof of Funds Letter must accompany the offer. In all cases, GPS and all lien holders must be able to
verify the Buyer’s financial ability to complete this purchase.
If you need financing, GPS may be able to refer you to a mortgage broker for help. Just let us know.
6) Who chooses the Title Company?
To ensure a smooth closing on this short sale transaction, GPS prefers to work with title companies experienced with
these types of sale situations. Therefore GPS recommends the following firm if you are closing a deal in
FLORIDA: Elite Title
This is not a requirement, but it is encouraged – GPS makes no money from any associations with any title
companies, this stipulation is simply to ensure that the deal closes and everybody leaves the closing table happy with
the results!
NOTE: If you choose not to use this company, you will need to have your title company provide GPS with a
preliminary HUD to accompany your offer. This serves two purposes: first, it is required by the lenders with all short
sale offers. And second, GPS needs to be able to verify that the Buyer has made their minimum deposit into escrow.
8) Who pays the Closing Costs?
In general, the Buyer will be expected to pay any closing costs associated with recording the deed and title closing, any
costs associated with buyer-financing, and the GPS Service Fees (but remember, these should be offset by the Seller
Concessions). Thus, in the STANDARD short sale, the SELLER’s Side will normally be paying most closing costs
for both parties (including unpaid taxes, liens, etc).
>Please see Section 4 of the Dear Buyer Letter for a Sample HUD to learn more.
HAVE OTHER QUESTIONS?
Please send us an email at gps@genesispropertysolutions.org or give us a call at 888-GPS-LLC7 and let us help
you.
On behalf of the employees of GPS, thank you for the opportunity to work with you.
| Contract Frequently Asked Questions |
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| NEXT STEPS |
| EMAIL GPS gps@genesispropertysolutions. ORG |
| FAX GPS 813-200-3324 |
| Call GPS 888-GPS-LLC7 |
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| Genesis Property Solutions, LLC "Creating New Beginnings for Homeowners" Let GPS guide you to a fresh start in life, too! |
| Copyright Genesis Property Solutions, LLC. All rights reserved. We specifically disclaim any errors, omissions, or any other inconsistency herein. We specifically disclaim any liability, risk or loss, personal or otherwise as incurred as a direct or indirect result of your reliance on this information. All GPS Fees are subject to change without notice, however any change will not affect deals currently in progress. |
| EVIDENCE OF SUCCESS: Why should you WANT to work with GPS? We get deals approved. Here is just a sample of the many files we have gotten Approval Letters for: click here for Approval Letter Samples |
| EVIDENCE OF SUCCESS: Why should you WANT to work with GPS? We get deals approved. Here is just a sample of the many files we have gotten Approval Letters for: click here for Approval Letter Samples |
| EVIDENCE OF SUCCESS: Why should you WANT to work with GPS? We get deals approved. Here is just a sample of the many files we have gotten Approval Letters for: click here for Approval Letter Samples |