Can Buyer's Agents Choose not to Show Short Sale Properties?

There are many more than do not close than those that do -- whether to show or not is up to the client and if they have the patience for them and they need their needs. Our 2 cents.

I've done three short sale properties and two foreclosure sales for buyers so far this year. If it's the right property for the buyer, you gotta do it -- part of the job. Suggest you take the Certified Distressed Property Expert courses, or something equivalent to get confidence in dealing with short sales. I'm listing them now, too.

Whew... that's a lot of questions for such a short post.  Yes, of course agents can choose not to show short sales and they should if, for example, it's a relocating buyer who needs to buy and settle quickly (we all know the track record of short sales); it really depends on what the buyers wants and needs are and/or their own expertiser - or lack of it.

I think it is fair for a buyers agent not to show a short sale property if they talk to their client about it and have approval.  But to just eliminate the homes wouldn't be in the best interest of the buyer in some cases.

As for questions

1. Has the seller sent the bank the paperwork they require to start the short sale
2. Has the seller or the agent talked to the bank
3. Is there a second mortgage?
4. Is the seller a hardship case?
5. Is the home in foreclosure? or the seller behind in payments?
6. Has the listing agent ever done a short sale?
7. Will you continue to market the property?
8. Are we the first offer?
9. Will you only work the first offer or will you be sending in more offers as they come in?

Karina - While I am not a Realtor who shows property, I do have many clients (buyers) that instruct their Realtos to not show them short sales.  After having wasted time earlier this year on short sales only to lose them to some investor who swooped in at the 11th hour to push my clients our of first position.

Most of my clients are first time buyers and at this time, have no more time to waste on short sales.  The deadline for the tax credit is fast approaching and they need to get into escrow soon and short sales take just too %@#^ long with poor results.

While short sales may be different in your market, around here (Ventura county, CA), they are an absolute waste of time and many buyers don't have the time to waste on them

If the client wants to see the distressed house, I will show it to them, but I will also tell them that it will take a long time to close the transaction, and that there is no guarantee that it will close to begin with. There is a part of short sales addendum where the listing agent can pick: a) the seller will accept other offers (that is why we have "Pending - Back-up Required" status in MLS) or b) the seller will not accept other offers.

One of MLS rules here: if the offer has been signed by the seller and the buyer, it should show up as "pending back-up requested" till the lien holder approves it. Once they do we go to "pending inspection", etc.

As long as the buyer understands what they are getting into, I'll show short sales. Most of my buyers do not want to mess with them. On occasion, there is a short sale property that fits the buyer.

I show all properties that a buyer's profile says they should see, AFTER we have an initial consultation where we discuss the pros and cons of REO's and short sales.

Of course it's the agent's right to exclude short sales as long as he tells his client up front that it's not part of his business plan.  The client can then agree or walk.  I don't exclude them but do caution on the pitfalls.

I show properties depending on certain factors:

1. The number of lenders --- if more than one lender, my buyers and I generally move on. We know only too well what an impossible task it is to get approval from two lenders. We wrote an offer in February on a short sale that the listing agent thought would get approval soon because there was a previous offer on it that the banks countered. But here it is, July...still no approval. So we've moved on.

2. If buyers instruct me to show properties (as long as realistically speaking, we can get approval) because they have time

3. If the property truly matches what the buyers want.

4. And as long as we're waiting, we're going to keep looking.

I think the banks have made it so hard to close on these and knowing the odds of you getting paid on a short sale are slim to non, I think it is perfectly alright for a buyers agent as long as they are upfront with the buyer no to show short sale homes!

As long as you let your buyer/client know, I see no reason you can't bypass short sales. The buyer will decide whether you get to remain their agent. There are quite a few of agents who have chosen not to deal with short sales and they're doing just fine.