| Short sales are now a huge part of the Southern | | | | prior to bank short sale properties are shown. If the |
| California real estate marketplace. Many real estate | | | | homebuyers have the patience and a good agent, |
| brokers, let alone buyers, do not understand short | | | | they can get a huge discount! Here is an recent |
| sales and tend to avoid them. The first big challenge in | | | | situation. Last month I highlighted a house in Wildomar |
| pursuing a short sale is finding a broker willing to put | | | | CA for possible short sale deal to a client of mine |
| the time necessary for the job. Most don't want to | | | | where they could get a house more than 75k off the |
| show these for many reasons. The big three are short | | | | market comparable properties. But they would to have |
| sales are a lot more work, homebuyers get very | | | | to wait a bit to hear from the banks, perhaps as long |
| impatient, and they can be stressful if done wrong. Let | | | | as 2-3 weeks. The listing was perfect for the couple |
| me explain these three challenges in order. First, short | | | | and was move in condition. Their reaction was in this |
| sales are significantly more work because instead of a | | | | market they insisted on getting a response inside of |
| two party transaction with just a homebuyer and | | | | 48-72 hours. I chose to risk my client contact and |
| homeseller, you have a four party transaction with the | | | | firmly told them that this deal isn't one you should go |
| buyer, seller, and two banks. And in this situation the | | | | after because the banks don't remotely care about |
| seller and two banks don't act the way a traditional | | | | you. They work 9-5 and have no attachment to the |
| seller would act. The seller is upside down financially | | | | property and if you want to miss a fantastic deal, that |
| and really wants the banks of their back. They don't | | | | is your choice. But I am willing to take on the task if |
| always care about getting the best price which is good | | | | you can have the patience. And when we get |
| for you. But the homeowner can also work a little | | | | approved, you will be happy and enjoy significant |
| against the purchase occassionally by not showing the | | | | equity and I will earn your business and referrals for |
| house in the best of shape or giving access to the | | | | the next time. After further discussing the details, they |
| house. Meanwhile, the banks aren't attached to the | | | | put in an purchase offer, got approval, and will close at |
| house, adhere to certain bank rules and can be difficult | | | | the end of this month. Dedicated lines of |
| to get on the phone and negotiate with. They often | | | | communication, integrity, and patience can get the job |
| use agressive type strategies in their efforts to | | | | done! The last hurdle is stress. Some of this has |
| maximize the absolute most money. In fact, the first | | | | already been discussed when dealing with patience. |
| and second loans negotiate among themselves | | | | However, the stress of what the bank will do, what |
| because what one lender gets financially the other | | | | people are advising you to do, and how drawn out the |
| doesn't. And getting in contact with those closers | | | | process is can make you crazy. For the broker, |
| require completed paperwork packages from the | | | | working with the other party and banks is not a lot of |
| seller and an purchase contract from a potential buyer | | | | fun. For the buyer, not screaming out your stress on |
| before the clock can start. Eventually there has be an | | | | your agent is vital. Much of the potential tension is |
| agreement between two banks, a seller, and a buyer. | | | | relieved by a thorough comprehension about the |
| By the time you get this all set, a period of 2-3 weeks | | | | transaction and a twice a week update. If the buyer |
| can easily pass. Plus with the large amount of short | | | | hears that the banks haven't moved, they shouldn't |
| sales on the market many banks are understaffed to | | | | overreact. With all that said, why do I recommend |
| handle the workload. Once you are past that issue, the | | | | examing bank short sales? Because bank short sale |
| second biggest challenge is buyer impatience and lack | | | | listings can be a great opportunity to get a wonderful |
| of comprehension. The worst buyer for a short sale is | | | | new home at a incredible discount. Short sales homes |
| many times an excited first time homebuyer unless | | | | are usually in much better shape than fully bank owned |
| they have a concrete understanding with their real | | | | homes and many time they are still being taken care |
| estate agent. Because when the agent has everything | | | | of. Also, they can be ideal for purchase price |
| forwarded to the financial institutes, the banks will take | | | | negotiation for many of reasons. Right now, banks are |
| 10-14 working days to even examine it and pass it to a | | | | filled to the gills with in default properties and the last |
| bank closer or negotiator. Asking an excited couple to | | | | situation they want is another, especially when there is |
| wait this out is rough. This is especially true in Menifee | | | | a qualified buyer in the mix. Why on earth would they |
| and neighboring real estate marketplace because | | | | want to gain another when given the chance to sell |
| there are so many properties on the market. Plus, | | | | one while more fees accrue or the market goes down |
| buyers today have everyone they know in their ear | | | | further? Their deduction is your gain and an good |
| whispering that they should get better response time | | | | agent's goal is to get you, the client, the best situation |
| or more service when they buy. Buyer lack of | | | | possible for today and earn your trust for tomorrow. |
| patience is the biggest issue and should be discussed | | | | |