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Top 10 Reasons Why Your Short Sale Will Not Close

10.) You sent in multiple offers to the bank. Put yourself in the bank's shoes, what would you do if you got 3,4,5 or 6 offers on your property? That's right you would wait to see if you get more at higher prices. We all know short sale departments at banks are extremely organized and they can surely keep track of multiple offers (Yes I'm being sarcastic). Oh did I mention accepting and having your seller sign multiple offers is probably a little against the law and at the very least unethically? Third party approval is just a contingency just like an inspection or financing. You wouldn't keep accepting offers if there was an only and inspection contingency right?

9.) You don't call the bank periodically for updates, you rely on them calling you. With literally thousands of short sale offers coming in, you need to keep your file fresh on their minds. Files are always being lost or misplaced, yes even in this digital age they get lost in cyberspace. A file goes to a negotiator via email and the pdf gets deleted accidentally. Do actually think the negotiator is going to remember let alone try and recover that info when he/she has another 100 or so to work on? They just say NEXT.

8.) You don't bother to lower the price periodically. Do I really need to explain this one, this is real estate selling 101.

7.) Your marketing, well sucks! No pictures, no virtual tours, poor description, etc. Again real estate selling 101.

6.) You don't know what the hell you're doing and are too pigeoned minded to actually take formal training to get better because of course you've been in business 28 years or that's what your broker told you to do. Formal training is not some 2 hour course given by your local board nor is it a 2 hour webinar. I'm talking at least 8 hours of classroom instruction or distance learning curriculum. Nothing substitutes for a live instructor if you have a choice chose the classroom.

5.) You don't submit an offer you feel is too low. WHAT? Let the lender tell you it's too low. Get the process going and hopefully you can get a hard number from the bank on what they'll take.

4.) You don't check this property's status and the bank forecloses. The short sale department does not communicate with the foreclosure/legal department. You don't know how many times I've called and informed the S/S department about an impending sale date and they reply, "Oh let me send them a message to delay the sale." This doesn't stop the process but in my neck of the woods if you delay a sale, you just bought yourself 60 days. It takes 30 days to get in front of the judge to schedule another sale date and that date is usually another 30 days out.

3.) Poor communication with the buyers/buyers agent and they walk. Mindset is crucial here. You need to prepare the agent and/or buyer for a long wait at least 90 days before you can go into the sales phase. You also need to let them know that not a whole lot will happen in the first 30 days and to expect updates every two weeks or sooner if developments occur.

2.) You're disorganized. If your the type that gets overwhelm at times (Like me) you need to systematize your business. You should have already done this but this is even more crucial in short sales. I designed an excel spread sheet that holds all my listings. I note whether they are active, pending , short sale, etc. It contains all the info I need in the notes boxes of the spreadsheet and I note every time I call with date and name of person. If you want a copy of it click the hyperlink.

...........drum-roll please........and the number one reason your short will not close is:

1.) Your short sale package is incomplete. A bank will not call you and say hey your package was incomplete. It will go in the round file cabinet. The more info you send them the better. I always call the lender first and ask for their specifics. I then send them what they ask and then some. A complete package should be at least 50 pages. I've seen some that are 100 pages. These servicers do not have a clue about your market. The more you send them pertaining to the market value the better chance you have at getting your package looked at sooner. You come across as a professional that really knows what you are doing, perception is the key here. (Who cares if you just took the Short Sale class 24 hours ago, you're a pro act like it!)

Good luck and happy short selling

Noel Padilla, CDPE

Posted by Noel Padilla, CDPE on 08/21/2009 08:56 AM

Comments (160)

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160 Comments on Top 10 Reasons Why Your Short Sale Will Not Close

AUG

Great post Noel! I'm working on 3 short sales now. This is hepful info.

Love the post. Number 6 is a little bit brutal, but very true. Love your candor!

Jen

I aim to help any way possible. If you can avoid these 10, you'11 be home free. Of course there's probably about twenty thousand others I'm missing.

Melissa

I had an agent tell me every time we talked about her 28 years in the business. She submitted me a contract that had an FHA loan and it listed the balance as 96%. It had about 10 or 15 other errors I finally told her just write up a new one and I'll have my sellers sign a clean copy. So much for "experience".

Noel - Great points and I agree with most, except.... number 5. I won't submit a too-low offer because it will take my seller's home off the market, get a rejection, and move them four months closer to foreclosure.

Wendy

Here in my area we can put it into a "Backup" mode and continue receiving offers and put them into back up position only. Hence I put all my short sale listing in backup mode after I receive an offer. I had a deal fall apart 1 day before closing. I had a back-up and sent it in and closed in 3 weeks. On another deal I lost the buyer about 2 weeks into the process but continued working the short sale with the bank. They came back with a counter offer and guess what, I told the bank the buyer walked and listed it at their number. I got a contract a few days later. Most lenders will delay foreclosure if you are working a S/S as long as you tell them a date is looming (See #4 above).

Noel, you've presented some great points that all could learn from. The only one that I disagree with is sending in a low ball offer. I will not send in a low ball offer as I need to be able to support the offer with market statistics and I need to be within a fair market value range. Allowing the hired BPO Agent to set the price is not seen as being advantageous. I want to be able to set the range and when the BPO value comes in way off, I can fight to get the right value assigned from having done my homework.

Lynn

That's why I meet the BPO agents at my listings....so I get to set the price. I bring everything I used to set the list price and hopefully I get that number. The point of sending in a low offer is to get the process started and it's also a wake up call to the lender. By the way the low offers I've recieved have not been bad considering the time it takes to get an offer accepted. Here in South Florida we are losing 1% value per month. So if it takes 3 months that's 3 percent. An offer 5% to 10% below market value is not unreasonable, in fact it's smart. Now if we were not in a declining market I would agree with you.

AUG

Noel: I'm back again. I've decided to reblog your post. Thanks!

Noel, I am here because of Melissa's reblog.

I have a question for you? How do you know when the BPO is going to be done?

I had one done on a home they didn't call for the LB code, sent in photos and I KNOW NO ONE entered that house. I swear they stole them from me.

I do the same as you do hold all other offers in back up ready to go, if the first buyer walks and NEVER submit an offer until the package is complete.

One of my biggest frustrations is the agents listing these and NOT HAVING A CLUE, we are just passing on even showing them.

Perfectly correct. I would also add a reason and it is our old dear friends Countrywide now BOA. If you are finally to right before closing and the buyer falls out, you have to start all over again like nothing before has ever happened. They also seem these days to want to purposely drag out the process as if they don't want a successful closing. My conspiracy theory without sufficient proof is TARP money. They want to dirty the books.

Noel,

Right on target with all 10!

As for #1 - even if I've previously sent some of the required material (say, with a rejected contract), I still resend everything the next time. The person handling my deal then has everything in a single, neat package and doesn't have to hunt down a thing.

Yes, it is a nightmare to fax 50 - 100 pages as one transmission. But I firmly believe it is one of the reasons my assigned negotiator responds to me and the deal quickly, professionally - and usually positively!

Noel -- all valid points. Totally agree on #6. A two-hour MLS class or webinar does not prepare agents to handle all the intricacies of a short sale. Last year, I got involved in one with an agent who readily admitted it was her first ss transaction and she wasn't familiar with the process. Needless to say, my buyers had to pull out. I found out later the property went into foreclosure.

Very useful information Noel. I think it is also important that agents who are showing short sale listings to their buyers understand the short sale process and explain it to their buyer before making an offer. I had an agent tell me after 30 days that the buyer is getting frustrated because it was taking too long. This is on a short sale listing with two loans and the agent was made aware of that prior to submitting the offer.

#9 is so true. I follow up weekly with the bank(s) on short sale offers and it amazes me how one week they will say they have everything and are just waiting for the negotiator to review the file or it is with the negotiator and the next week they say they closed the file because they were missing something. You have to always stay on top of it.

Noel- Thank you for the great list. I think you've closed some short sales in the past? Good blog article

Noel, great list.

I've been told that it's the third buyer that gets the short sale. The listing agent is often unprepared when the first offer comes in. By the time the package is finally complete and submitted, 30 days have gone by and the first buyer walks.

The second buyer has a better shot at it, but gets impatient and walks. By the time the third buyer shows up, the listing agent knows what to do and who to talk to and the process runs as smoothly as it ever will.

At least, I hope that is true. I'm the buyer's agent for the third buyer on a short sale right now!

Noel, we couldn't agree more with your post! 2 hours of training doesn't prepare an agent for details of a short sale. WE all know short sales are NOT rocket science, but they are time consuming and you really need all of your "t's" crossed and "i's" dotted. Keep your clients and your commission and outsource it to a reputable company that does short sales all over the United States with a plentitude of references and a track record of being in business for 4+ years. www.myopentoclose.com

We <3 short sales!

Great information, will share with my membership.

Agree with most items on the list. In Columbus, Ohio, due to the many foreclosures we have, our local board actually came up with short sale specific documents to help all parties involved to understand the situation better.

You say: "accepting and having your seller sign multiple offers is probably a little against the law and at the very least unethically?"

We dare to disagree. Our short sale forms disclose that the seller has the right to accept multiple offers and also has the right to continue marketing the property till the lender(s) have accepted a short sale offer. On the other hand, the prospective buyer has the right to cancel the contract at any time as long as it has only been signed by the seller and not yet accepted by the lender(s).

We all know that rarely will a buyer hang in there for weeks or months, so why stop marketing the property after only 1 offer?

Noel,

We recently had the short sale go to foreclosure while our buyers had an offer submitted. They bought it as a foreclosure for $10,000 less a month later. Unfortunately, the 90% loan program for 2nd homes went away (mortgage insurance issue) so we had to look at 20% down instead.

Noel - This is the TRUTH! We had a client in a short sale and we called the listing agent for an update after thirty days. He didn't even return our call. When we called after 6 weeks, he had nothing to report. We bailed and sold the buyer a traditional sale.

In contrast, we have the local title company working on another short sale where we bought the buyer and every week she emails us a status update. Over the last 60 days, she's submitted the package, been assigned a negotiator, got the Notice of Sale Date rescinded, and is working towards a closing. That is a short sale with communication and light at the end of the tunnel for the buyer.

So Accurate, Noel.

I saw the writing on the wall so like you took the CDPE training. It rocks.

I have to say I agree with all your post. Alex would be proud.

Especially #6;

Short sales are just really coming into play here more and more so most agents have no clue. I have to say my buyers and I lost a home last winter because I did not know as the buyers rep and the sellers agent had not a CLUE how to get her client's home sold nor did I know how to help her at that time. It is now still sitting vacant and we could have picked it up for $10k less than owed a year ago.

#10 I have also found that agents are taking multiple offers and do NOT know why NOT to do this. They think if they submit more than one the bank will pick one. I have explained until I was blue in the face to a listing agent in my office why NOT to do this. I still don't think she believed me but it took her 6 months to finally go to closing with one after most of her buyers fell off the face of the earth. DUH, training vs no training.

Do the realtors above have multiple offers accepted on a "normal" sale by their seller? I don't think so. They take backups or whatever is acceptable in their state. Why would anyone think a short sale is different?

If you check out Trulia, the agents all tout they have successful short sale experience. Do they really or have they struggled thru a few sales? Do they even realize what CDPE or other training can do for their level of expertise? It seems not. It seems they think because they have some under their belt, they are experts.

# 5 To the ones who won't take a low ball offer. Do you have any other offers? Do you not present a low ball offer to your sellers? It is not your decision as to what you THINK someone will accept. If you have offers coming in, of course don't present a low ball to the bank; save as a backup. If not, take what you can get. If you have used the proper marketing strategy, you are prepared to present low ball offers to the bank. Would you rather your client's home go to foreclosure? What are you trying to accomplish here? More money in your client's pocket? Uh, I forgot, they don't get any money; its a short sale. Future liability? That is in the negiotations. Tax consequences? Obama is trying to get those removed. :)

Again GREAT post, Noel.

Wow Noel, you nailed it! I have heard or seen almost all you stated from local agents that are having problems with their short sale. I ask some questions like you stated above and the answer is, "I did not think of that, thanks." I have our county's website as a desk top icon. I check my short sales weekly for foreclosure notices, as they do them every Friday in Akron Ohio. You won't believe (YOU would) the number that I have stopped and the SS dept had no idea that the sale was scheduled.

I would like to reblog this for my local AR members in hopes that it will help them also. Thank you so much!

Noel: Saw this reblogged by David Childress and had to come by and virtually shake your hand. I think number six is my favorite.

Great Post, I do tend to agree with Wendy on point number 5 but you meeting the agent at the house is the best way to help assure the BPO is where it needs to be. I take the lock box off when we get an offer so that the BPO agent has to call me to get in.

Point number 1 is where many really screw up!

Noel,

Great post and congratulations on the feature and the reblogs.

This is valuable information for agents who have either never done a short sale or who have and wondered why it went wrong. It takes patience, persistence and your paperwork in order.

Noel, you have almost put together a prescription for disaster, and there are numerous reasons a short sale possibility goes off track. The disorganization one will kill you.

Yes this is a great post with good information. Thanks for getting it out to AR today.

Patricia Aulson/portsmouth nh real estate

Right on target! I'm going to share this with agents in my office. You say it all better and more concisely than I could have. I may have to share it with a few listing agents as well. It boggles my mind how many agents ship stacks of offers to the bank as if that's actually going to expedite matters.

The way to get the bpo agent to call you is by putting in the showing instructions in EVERY short sale listing to "call listing agent". What I do is just change the showing instructions after I sendthe offer to the bank. When the BPO person is sent out, they check the mls and call for access. I don't remember ever doing this myself, but I have heard of listing agents asking the bpo agent when the agent calls, if they would like to be sent a copy of the BPO and most of the time the bpo agent will say sure. Then the listing agent sends their bpo to the bpo agent and everyone is happy. I am not suggesting anyone do this, I just heard it was being done.

Great job, Noel. CDPE is the greatest course I've taken & it goes on and on. I'm in CDPE Advance & it keeps me moving!!!

Great article! I never get involved with short sales unless the listing agent knows what they are doing. These sales are doomed from the start when you have an inexperienced agent "winging it"

Excellent info. As an independent loss mitigator I've found a way to short circuit the multiple offer situation. It costs a few extra dollars up front, but it's worth it as I have a very good track record of closings in a relatively short time period.

I spend extra time with the lender educating them on my process... it works to everyone's advantage even though it requires time and patience. I obtain an appraisal up-front plus all of the comps needed to help determine the best price for the market. This saves time, money and frustration all the way around. The sellers feel more confident about selling their home more quickly for a better price than they might with someone else. The lenders appreciate not having to wade through multiple offers and their turn around time on accepting a reasonable offer is shortened. I don't lose as many buyers because of the shortened time factor as well as more confidence with them becasue they know their offer is good enough to be accepted by a lender. I maintain daily contact with everyone involved, my paperwork is complete, organized and ready at a moments notice.

It's mind-boggling to me that more people don't do this. The other method is archaic and does not work to anyone's advantage.

How about #11 - You don't continue to market your listing for additional offers should the initial buyer walk or is unwilling to meet the terms of a bank counter offer.

I generally have around 20 short sale listings, and usually have at least 5-7 offers (in my file) by the time the bank comes back with a response to the one offer that was submitted. I rarely have had to worry if the original buyer is no longer around.

Excellent post. I will not show a short sale property to buyer's if the agent says they are accepting multiple offers to send to the bank. Forget it. Work one at a time and let the bank come back at a higher price if need be. It's too much paperwork and confuses the bank. And most big banks, such as Wells Fargo, are now requesting you only send in one offer anyway.

Most banks will only look at one offer at a time, and if another one is submitted sometimes it can start the whole process over. I do however hold more than one offer in back up, just because so many times the 1st offer you strat with withdraws for number of reasons by the time the 3-6 months rolls around to get an approval.

Very interesting TOP 10 list! I'd add to your #10...ALL pages of the package should have the Loan Number and Property Address clearly marked. If pages are separated from the package, it's easy to identify WHICH package it belonged to. Hard to imagine those lenders could "lose" some pages, right?????

Great post!

This is a great blog. Many listing agents do not mean to plan to fail, they just fail to plan and getting a good education in our market is vital. Plus they need to keep up with all of the updates from Fannie Mae to Freddie Mac and FHA. Read every post that you can find, look up new guidelines in your local board and stay ahead of the curve.

But if you want to really help people, short sales are the way to do it!!!

Bravo Noel for such a good post.

Great post Noel - I really appreciate Reason#10 --- I am frustrated with having to explain to (some not all) buyers agents why it is not my business practice to send multiple offers into a bank(s) in short sale transactions - my business practice is not highest and best - and no my client will not 'just' sign off on contract to get something started with the bank(s). Thanks for the post - good job - and extremely relevant in our industry.

Noel,

Wonderful blog!!! Thanks for organizing & sharing this info!

Kathy Opatka

And one of the biggest reasons I see here in Marin? The agents are just too important to bother with short sales. You would not believe how many times I hear people say they don't want to deal with short sales because it's too much trouble? Those are the ones who probably committeed your points one to ten and not close them. Diligence and keep up with the changes on all fronts are the way to success.

Thanks for posting this!

Noel,

You hit the nail right on the head! We deal with so many agents that STILL send in multiple offers to the bank and we always tell them "You know you are just going to confuse the bank and hold up the short sale process?"....Great post!

Excellent post! Thank you for sharing!

Wendy, please note all offers must be presented by law, even if it is a low offer.

Hi Noel,

I was an elementary teacher for 40 years and all my professional life, I continually took courses to become the best teacher I could be. As I became older, the more education I needed as everything changes so quickly now. As a realtor I take a course or attend a conference a month. I can never know too much.

I read your article as felt pretty good about a recent course I took in Tampa. It was a certification course on distressed properties CDPE. It was the best $500 I had spent since becoming a realtor seven months ago. After two full days with an expert instructor, I came away with knowledge of how to put a short sale pkg together. The course provided resource books and a CD including the 80 page a short sale requires.

I am not going to shy away from short sales. In fact, as the new wave of ARMs come due, I will celebrate in my ability to help sellers hold off foreclosure and buyers get a great deal. It is our responsibility to remain at the top of our game with the most up to date knowledge possible.

Betsy Hartge

Communication with all parties is crutial in a short sale transaction. Nice job with your article.

Good points Noel, if all Realtors have a standard to follow when presenting short sales packages. . banks would not have a choice to standardized their responses as well. . your post is a great start.

TONY,

I'm sure Noel and Wendy will answer your post but I got here first....Offers are to be presented to the Sellers, unless you have an agreement not to do so. The Lender can only receive the offer that has been converted into a contract with the Seller and Buyers signature. The Lender is not privy to any other offers that may arrive, that is between the buyers that submit the offer, their agents and the Seller...not sure where the "by law" came from. (I guess there can be local MLS guidelines, if that is what you mean)

NOEL,

You did the CDPE and Florida area Realtors proud. Great Job!

Become a CDPE Today

Fantastic post and well written, pat yourself on the back!!! Thanks!!!

Fantastic blog! Hope all licensed realtors read it! Our marketplace would be in a better place.

Noel,

You are right on the money! I would, however, move #3 to #1. Non performing buyers agents/buyers are the number one reason short sales don't close. I get approvals on 97% of my short sales, but I sure don't close that high a percentage because of this.

www.short_sale_expert.activerain.com

Noel,

I think you summed it up well, every bank operates differently and it is important that we do not make the mistakes you outlined. I have found that the more work you do in making it easy for the banks the sooner they will respond. Don't waste their time by not having a complete package, make sure that it is well organized will current docs and all the signatures and then I call every two days even when they say they will reply in 10-15 days, I find that the friendly prodding does not hurt.

Take care!

RJH

Noel: The truth hurst sometimes but you hit each and every point dead on! Problem is with the Professional Standards Committee at the State and Local levels in California who are insisting now that there may be a "tort" issue with the lenders on the advice of their attorneys. Not so in my humble opinion. As several who replied pointed out the seller is your client not the bank. Why not handle the contract exactly the way you handle an open market contract. Once an offer is signed and acceptance is communicated to the buyer then off you go to Pending status andall subsequent offers immediately become back up offers. Not leaving the property active or active contingent eliminates all the confusion. Bank gets the sellers best accepted offer, buyer gets to feel that they are actually being treated fairly, seller can now speed up the short sale process (BTW a good package submitted only takes about 2-3 weeks for acceptance not months as the rumor mill purports) and the foreclosure can now be placed on hold pending the successful closing. Thanks for the excellent post.

Hi I am a Realtor/Investor...Do any of you guys work with investors and or do in short sale investing. I am looking for great deals as an investor to work with other realtors with listings. This partner ship pays 6% to the my realtor partner whether or not you bring the buyer..If you would like to get more info email me or give me a call...Emmanuel4grg@yahoo.com or 954-889-4403...

Excellent blog - very informative and funny too - thanks Noel...

I think those are all good reasons but I think it goes beyond that as well. My BIC spoke to a high level manager at a big name bank (don't want to name them for fear of reprisal) recently. The bank manager confessed that because banks are so compartmentalized and bureaucratic that there often is no incentive for a manager working collections to allow a loss on a particular property which also reflect poorly on his department and his performance report. On the other hand if the house goes into foreclosure it does not reflect poorly on the collections office nor does it reflect poorly on the managers performance report. Thus, the incentive often with some banks is to allow it to go into foreclosure. I thought that was very interesting.

Noel - This is a great list, and it explains very quickly why I have studiously avoided selling short sales here in Austin.

Don't get me started with the multiple offers. And how can anyone do a multiple acceptance? When I am working with buyers and want to present offers, I always call the listing agent. Many times, they are unreachable or don't return my call. This is a bad start to a long and difficult transaction that "requires" communication. So there is a red flag. Here is what I am trying to find out. Is the property really Active. At least 50% of the time here in Southern CA, I will find out the seller has signed an offer & it has been submitted to the bank. The status should be Pending or Backup. MLS could care less if the bank has approved the offer. If the seller has signed, it's Pending! Next, I want to know a little about the hardship. No hardship, usually no approval. I want to know, if the agent will submit multiple offers to the bank (auction) or choose an offer and have the seller sign. I have NO interest in being part of an auction on a short sale. This entire transaction is going to be about teamwork with buyer's agent and listing agent. As a CDPE advanced, I agree with the positive comments regarding training.

I couldn't have said it better my self. These are all great points. I wish more Agents would acknowledge these as standard minimums.

Really great list. I'm not sure which one is my favorite. It's like a rocket, all ten of these things need to be done.

Great post, very informative, I will be sure to share with my local agents!

Short Sales present a lot of opportunities to learn new skills, don't they?

I couldn't have said it better my self. These are all great points. I wish more Agents would acknowledge these as standard minimums.

I agree with most of it... well put again aloha Jeff

How about an attorney told the seller to "file bankruptcy". Would a seller want to sell the house first then file if that was necessary? I can't believe some of the legal beagles are screwing up these short sales due to lack of actual knowledge.

How about the loss mitigation company that "adds $3500 for buyer fees" in order to have the short sale offer submitted? What the hell is this? I can't believe we have some companies taking short sale listings for these sellers......charging the BUYERS $3500 to pay a loss mitigation fee.

Here is a direct quote from a VP of Loss Mitigation "short sales fall apart because Realtors don't follow-up or third party mitigation companies try to add junk fees on the HUD-1". I was told that the lenders do not like junk fees on HUD-1 and if a buyer is willing to pay an additional $3500 for a junk fee then why not increase the offer $3500.

Great post. Better than Letterman.

Greg post! I have only closed 3 ss, have offers submitted on 4 more ss and have one ss listing with no activity on it. I really like number 1. However here on Kauai the escrow companies will not open a short sale escrow until the bank accepts the offer and this is still taking us no less than 6 - 8 weeks to even hear from a stage one negotiator. Thus lots of buyers find other properties and bail before we even get to that point. Then we are down to no offers on the table. I like what you are saying but seems a bit risky when it is still taking us so long to hear from the banks?

I run from shorties like the plague and ('what you resist persists' is the old saying) yet I've landed in and closed a few.

I got a mentor who's been doing them for YEARS. (they are not 'really' a new thing) Signed up for CDPE also (it is offered online) -- not because I want those deals -- but because I have to deal with agents listing them who don't know anything and I don't want to be part of the problem.

Your #1 is almost as weighty as 10-2 combined! I was taught to send that package '9 ways till Sunday' - fax, overnight mail, interoffice mail and e-mail if possible - all with tracking - and repeat the process UNTIL you have confirmation that it's received and complete.

In my area we are not seeing ANY BPOs any more for appraisal - they are using real appraisers.

Reposting this today and thanks again!

PS. I had to giggle at your comment about 'the agent who kept "reminding" about her 28 years in the biz. They are usually the ones who quit learning anything after the first year and are repeating the year over and over.

Noel, great post! I'm with Jason Crouch. I just stay away from Short sells as much as possible. I tell clients to get ready for a rough ride if that's what they really want to do.

An excellant summary of reasons; thanks for the information. I just had my first short sale close last week after a "short" five and a half months of frustrations and delays. "It Only Goes Up From Here" !! Thanks

This year I have done 3 short sales - 2 as buyer's rep. and 1 which was my listing and my buyer. I recently submitted an offer on a property listed by an agent who had the CDPE designation. The offer was "as is with right to inspect". When the counter came back to me, the listing agent (or seller) had stipulated that the inspections had to be done within the inspection period based on the effective date being the date the seller agreed to the contract, not the effective date of contract being upon lender approval. In other words, the buyers had to put out money to have the utilities turned on and inspections done before knowing whether the lender would approve the sale or not. The listing agent did not even know if the lender would accept the sales price much less any other terms of the contract.

I have not yet taken a CDPE course so I am wondering if that procedure is taught in the course?

Noel, Absolutely right on post. Hopefully some fo the agents that are trying to do short sales and think they understand the process will read this and take you 10 points to heart.

Eric, Thank you for the idea of changing the info in the listing to make sure tha BPO agent contacts. I just had an agent not contact me even though the bank instructed him to, but I got him on the phone 10 minutes before he got to the house and at least had a conversation with him.

Directors REalty & Jerry, Right on points about mulitple offers. This is the only way to professionally handle them.

Noel, thanks for the top 10...I think that your #1 reason is the key in many cases. Have everything ready - everything - and then send that to the lender. Then follow up with them, don't wait for them to call you.

While your at it, check the local paper for foreclosure advertisements on your property. This could prevent a world of hurt for your seller if you intercept the foreclosure before the lender tries to sneek it past you.

Noel, If we all used common sense with short sales we would have much better success. I'm with you on all but #5. My job is to negotiate "highest and best" with my seller and then submit that accepted contract to the lender. Of course this needs to be done in a reasonable amount of time.

Good post Noel.

And Tony. All offers have to be presented UNLESS my seller instructs me differently.

Yaaay! This really needed to be said. It's so frustrating when agents "dapple" in selling short sales. Either get the training required and be organized or don't list/sell them. Thanks Noel!

You're dead on right -- and worst is having buyers who want to write on an inepmt agent's short sale.

Having successfullly closed numerous short sales in the past 4 years - you also need to aware of the changes each bank is making. Which ones take longer etc.

I'm also having more success keepigng buyers in the game by with direction from my seller a) asking for money to be put in escrow to be returned at any time with notice and b) marking the property pending in the MLS. Once I get an accepted offer from my seller, I stop taking everything except back up offers.

Sorry it's taken so long to respond but it's been hectic today and my phone's battery died. I finally ran to someone's PC after a friend informed me of my post being featured. I have to give credit where credit is due. If it wasn't for Alex and Cadey with the the Distressed Property Institute and my mentor and colleague Sidney Jimenez with Keller Williams, I'd still be stuck on #1.

As with most posts I expect some negative feedback. I was alarmed that most of the responses have been positive. I was sure someone was going to expload and defend #10 to the tilt. The reason I wrote the blog was because I had been showing some buyers REO's and S/S around town. they sent me a S/S they wanted to see I would get a sick feeling in my stomach. At one point I had a Rant moment (Similar to Senior moment) and fired off this blog in like 15 minutes, I was really upset.

Thank you all for the comments, when I get home I will try and respond to most of you all. I will also be posting a link with my spread sheet as soon as I strip some of the personal info of the parties involved out.

Noel Padilla, CDPE

Great Post. You are right on. Anyone agreeing with Noel should forward this to other REALTORS in t heir area.

In lieu of short sale consideration some investors may require that all offers be presented to them. Some may require a certain time frame for response so they can gather offers. Our Statewide forms allow for both situations.

Our laws require that all offers be presented to the seller. That of course (Like Bryant mentioned) can be dependent upon the sellers instructions otherwise.

Presenting offers to the seller and presenting offers to the bank (which is technically not the seller) are two totally different scenarios.

Gene

Good post Noel I agree with 95% of it...

I think the #1 reason that short sales do not close is the short sale was not qualified to begin with. From the get go, they should have been advised to speak w/ their accountant and lawyers if this is the right direction to take. If the seller has some money and still has jobs but they'd like to sell short because their property values went down 50% and they could buy 50% cheaper in the same neighborhood, there is no real hardship, any agent who takes a short sale listing will be wasting time, energy and money. I had walk away from listings that I know will not qualify.

Great tips, I'm bookmarking this post!

Regarding *7 - How many times have we seen a Short sale that is really just a way for the owner to extend their "free" stay in the home? Is the agent in colusion with the seller to make it difficult to show the property? No pictures...no interest. And if the seller plans on the foreclosure/bankruptcy route, why not stay in the house as long as possible.

I think many of these listings are just wasting the time of serious sellers. If I am showing properties and a client wants to see a short sale listing, I will first find out how far along the seller is in the process. Is there an approved price? Is the agent really a SS expert or just someone with a RE license masquerading as a professional? If I don't get a "warm, fuzzy" from the agent...Bye, Bye NOW!

I love this post! I can not agree with your #1 more. I DID invest in my short sale training - started years ago and continue to educate myself. I have heard time and time again that if your packet is not complete, you never even start the process. It is put in file #13, so to speak. Thank you for this post.

JOHN,

There really isn't such a thing as an Approved price. If a price is approved by the Lenders for a specific Buyer and that Buyer doesn't close. The Lenders will not necessarily rubber stamp an Approval for the same price. Some Lenders will even start the process from scratch.

Don't get bamboozled into a "quick" closing because they have an "Approved" price. One doesn't necessarily go with the other.

Noel, you are right on the money with every point. This is not a job for sloppy (or lazy) agents. Completed files and constant follow is a must!

Good post, very informative.

Noel, I agree with you especially on the training. Short sales can become extremely complicated transactions if you don't at least have a handle on what documentation is required for a short sale packet.

As a buyer's agent, I have to agree with Melissa's comment. More often than not, after speaking with a short sale listing agent on a property my clients are interested in, I find that the agent is not too familiar or is inexperience with short sales.

Excellent post. Number 1 is the biggest problem in my area as some agents flood the bank with a bunch of offers confusing the situation. The seller is still the seller and as you stated the short payoff is a contingency.

OMG!!!!!!! It's gonna snow..either that or the Sox are going to beat the yankees as FINALLY a REAL DEAL post about short sales...I applaude you on this one. Too many bozo agents stinking up the joint playing short sale expert out there screwing things up royally!

Great Post! I am working on my first short sale as a buyers agent... I will forward this to the listing agent.

Fantastic post! These are 10 things that I think of each day as I am negotiating my short sales (and listening to others complain about why theirs don't sell). It's all about being proactive, and being organized. Being an educated industry professional facilitates the short sale process for everyone - agents, negotiators and clients alike. Best of luck to you and your future short sale success!

Great post!! The CDPE training really does pay off.

Your #4 is spot on, and I've lost a listing with an over asking price (and BPO!!!) offer because AHMSI did not give these buyers enough time to close their loan!!! All because the foreclosure and short sale dept did not communicate with each other. I find this instance especially grating because my buyers had it under contract at $309k and they sold it at auction for $166k.

Number #4 is of paramount importance!!

Noel !

Well this just about sums it up huh !

Very nicely put together - I have experienced agents commiting most of these errors with regards to a number of short sales transactions I have been involved in.

Great post, and congrats on a very worthy feature !

Cheers !

Sheldon

#3 #3 #3...why are you listing agents such "secret agents??" I've had 2 buyers walk on 5 contracts over the last 4 months because no one wanted to share the information about the negotiator, the bank, the status, let alone take care of the property while it was under contract. Buyers aren't stupid. They'll wait on a house as long as I have something to tell them. They'll wait on a house as long as they believe the house is being taken care of and not being allowed to rot, i.e., no air conditioning (mold & mildew), no water (broken seals on equipment and critters coming in through the toilets), no electric (therefore, no lights leading to vandalism and squatters), no yard maintenance (the house appears abandoned and invites all kinds of trouble). Please don't keep the buyer and the agent in the dark.

Ah, you say, no money to keep the house up? AC at 80 to 82 is cheap. Turn off the HWH. Water even in my area (Florida) is $l5-30/mo. when the house is vacant. Electric to run the AC and 1 or 2 lights is worth the peace of mind and safety of the house. Mowing at least the front yard is a must. Don't let your listings become the proverbial "pig in a poke." Don't let me walk my buyer away when you know how priceless buyers are in this market.

And remember that those of us who are doing short sales have worked both sides of the fence. We're willing to pitch in and help any listing agent get the deal done. Don't be a secret agent.

Sally Rackey, RealtyOne Alliance, Sarasota FL

Wow ! What a great post every Realtor should read ! We have been very successful with our short sales - all because we do not break these rules as well ! Like anything else, practice makes perfect !

Great post. Do add to the list to put the loan number on every page. Also, I find email is more effective for response w/the negotiators rather than phone and also provides tracking. Get an email address and use it!

Noel,

Thanks for the post. I agree with the points and often explain these points to other agents that think working Short Sales is a waste of time. You have to be systematic and diligent. One suggestion for those that don't submit low offers, don't rely 100% on Sold Comps. Look at the Pending Comps to determine the pricing trend and then consider how long your property is going to be waiting for a reply. You might just find that your property is going to be right on or close to the target and that is what you need.

Great post! Like you , I am a "systems' kinda guy.....I would love to get a copy of your "organizing spreadsheet" .....Thank you beforehand. fastiz51@gmail.com

AMEN! Great blog post. I interview listing agents to determine if they know what the heck their doing on their short sale listings. You can pretty much tell how the short sale process is gonna go by asking the following question: #10, Do you submit more than one offer to the lender?

I had a listing agent tell me the other day that if she only has one offer she will present that to the bank but if she gets multiple offers she will "probably" submit all of them to the bank and let them decide!!! Now does that really make sense?? Oh, I forgot to mention the bank is BofA/Countrywide!!! I told her that I've done and am doing several short sales with BofA and they only want one offer presented to them. Her response: "Well I've worked with them as well and I've heard several different things sometimes they want you to send them all in." She's received a lot of activity on the property, my client wanted to submit an offer anyway. I pretty much figure our offer is going nowhere!

I have two other deals where I'm representing the Buyer. Two separate Secret Agents have not responded to requests for updates on the short sale, nothing. I got my Broker involved because of course my clients really want the houses and the Agent or his Broker will not respond to her either. Just tell potentially Buyers and their Agents to get lost if you feel the offer is too low or whatever! Seriously, how do these Agents get Clients??

Oh, the best one, a Listing Agent told me he couldn't give me an executed contract because he doesn't have his sellers sign any of the offers, he just sends them all into the bank and when they (the bank) makes a decision then he has them sign the highest and best offer. WHAT, I figure he's gotta be hosing me! No wonder its been 5 months since we sent in our offer with absolutely no updates! Hello, it's not even a contract unless it's signed by both parties, the Seller hasn't even agreed to sell it why on earth would the bank look at that "offer"?

Listing Agents, PLEASE help us SELL your short sales by getting the proper training or hire/subcontract or refer your listing to someone who knows how to help distressed homeowners!

When I see bad marketing of short sales I almost wonder if there is some kind of fix going on where they already know who they want to sell it too, and at what price.

Excellent information. Short sales are really a totally different animal than all the other transactions. They are not for the faint of heart.

Very interesting - these short sales are only going to increase in volume, so I think becoming comfortable with them is a great idea - thank you for the tips! 100 pages, really???!!!

This is very good information. I have been working on several short sales and have been quite successful at getting them closed. However, the information that you have provided will help me in streamlining my process in working them.

We are in the new normal, and we all need to learn how to list and sell short sales correctly. This market will be with us for a few years. "Evolve or Disolve"

Dang, Noel...I could tell half-way thru your post you are a "for real" ss agent. Rock on!

CDPE training is just the tip of the ss/ed iceberg :-) Nothing beats an experienced mentor, huh! Then get ready to learn new stuff daily in the ever changing ss world . Ya gotta love a challenge :-)

I'm in the middle of a short sale as a buyer's agent. This is crazy. But pretty soon the contract is going to go under because the bank is almost down to 21 days before the scheduled closing... and they haven't responded.

The banks need to learn how to make this process quicker...

As a professional 3rd party loss mitigation firm I have to say if everyone handled their short sales as Noel does all our files would move the system faster. I continue to be amazed how many agents clog the SS system by sending in " bogus offer" to see what the bank will say about the price. If you do your CMA you know what the bank will accept, it is really not rocket sience. Send in complete packages so the banks can review it and not have to spend valuable time to tell you what they need. Get their document list online if you are unsure. And, if you are not 100% sure how to handle a short sale with the bank turn the file over to someone who does .

Sonda,

These agents you are talking about do not need to be in the business of selling short sales, or maybe anything else. In any case, I would not write an offer with any of them. How could I and actually be representing my client?

Lane,

When I represent the buyer, I do not even put a in a closing date. I put it as 45 days after bank acceptance. HOw can we have a date when we have no idea when and if the bank will agree to anything. And who wants to keep doing extensions? If I am the listing agent, that works fine as well and I like to get backup offers in case the first buyer walks or will not agree to the banks price.

Gaby,

Ahem to that. Why would anyone submit a package that is not complete! It is a waste of everyones time and energy.

"Presenting offers to the seller and presenting offers to the bank (which is technically not the seller) are two totally different scenarios." I agree with #76 Northwest!

Definitely pick an offer to submit to the bank, but let the SELLER know about all offers.

The first offer is "SUBJECT TO THIRD PARTY APPROVAL" - it's not subject to SELLER approval.

Great post Noel!

Hi Noel -- It's too bad there isn't a consistent and standardized online form for submission so one knows when one hits submit, that it's done and proper.

Noel, Your great blog is causing quite a stir.

Chris,

Again, you really have to submit everything and then get them to akcnowledge it in their system. Soemtimes I have had to send it in by fax, email, or overnight more then once before they acknowleged it. And then they sometimes lose the whole file in mid stream. Or sometimes they lose something out of the file like my authorization to speak to them!! The incompetency is unbelievable. But, then, I have to remember how much they are getting paid.

Great Post....

Couldn't agree more. It is great to see so many agents agreeing and the tide turning toward the way I have handled short sales for the past 2 1/2 years with 100% success rate. Unfortunately the San Diego market is still full of "agents" who have forgetten all about good will, fiduciary duty and customer service.

I also interview agents before wasting my buyers time on an offer. One agent in San Diego with 100+ listings, submits one offer (not accepted) then after lender approval goes back to all the other offers and says "put in highest and best". Not sure how he does this with Countrywide as they make you start over. He is turned in daily for violating the mls rules yet continues to play these games.

I would love a copy of the excel spread sheet you use. I have 3 short sales with Bank of America/Countrywide and I really need a way to better keep track when they are taking 6-12 months to approve after all the starting over and lost paperwork. They are the absolute worst company to deal with.

I have also gotten in to the habit of thanking agents who actually answer their phones. We have agents in San Diego, who do not answer their phones, then their message says "don' t leave a message". How is that for customer service.

10 awful great reasons you won't be able to complete a short sale.

I had one I had to tell the seller's agent it was going to sale, couldn't reach the agent who was out of town, and it went on the courthouse steps.

WOW, I love these blogs. SO, here's the next thing....On 8/21 I attended a program called The Long and Short of Short Sales from a Tax Perspective presented by one of our local CPA/Attorneys.

This was a jaw-dropping experience for many of us in attendance. Here are a few key things that were covered: tax liens, deficiency judgment, insolvency exclusion, tax erasers, Form 1099, What would it be like for a seller to find out they owe taxes on $100K from their ss even if their income is at the poverty level or don't even have an income? I don't want to risk misquoting anything from the class, but I know what I heard, among other things, and understood perfectly. Since I've been reading a lot about short sales, I was familiar with most of the terms, but not the true consequences that don't get explained with the sound bites on TV about all the great stimulus programs. It is a jungle out there! Or a swamp if you're in Florida. Of course, none of you would give legal or tax advice, but if I was handling a short sale, I would have the seller sign a form saying I advised them to seek professional advice regarding the possible tax consequences. So FYI, you may wish to contact Jo Ann Koontz jkoontz@icardmerrill.com. She was amazing. She may service other areas in Florida, or share her presentation with some referral in your area. BTW, I have no special interest other than to share some really great information in appreciation for helping me get totally clear on managing short sales. This is my first post on AR.

Excellent Post! Wish I had this information a year and a half ago!!!!! But you nailed it and this information can only come from "experience."

Hi Noel, I do one thing about your list. If it was mandatory that every agent who thinks they are specialist in Short Sales ( my legal adviser suggests that this is a bad idea) and understood what you wrote and would committed it, their peers would not have anything to be critical of and their clients would benefit but getting the process consummated faster.

What a great post. I've run into so many agents that submit multiple offers to the bank on short sales and there is no convincing them that it is wrong. Maybe they are getting it confused with REOs. All offers are submitted to the seller. In short sales the the owner is the seller, not the bank. The owner takes what they believe to be the best offer. In REOs, the bank is the seller and should see all offers , no different than any other seller.

Great Post! #11 - You didn't send a "Thank You" card! I have found sending a Thanks A Bunch Card to the Loan Adjustor Specialist is a great way to show your appreciation and stay connected:) I would love a copy of your spread sheet. As you said it...we should all have our business systems in place. I am guilty - my spread sheet is not working:( Thanks again for sharing all this valuable information and i'm really enjoying reading all the comments. Have a great day, Angel Quintero angel@KNEWHOMES.com

AUG

I really enjoyed reading the list and all the comments. A few years ago we all prayed for a shake out in our industry, and it seems we prayed too hard. Short sales will shake out the non professional agents, especially those who rely on experience.

Wells Fargo and Bank of America held a joint seminar this past week for agents advising them how they work with us. BoA is implementing an online e submission program where both the agent and negotiator have access to the file. Both banks stated that they are making a commitment to work out short sales and prevent more homes from going into foreclosure.

By the way, didn't NAR claim to have kept the banks out of real estate?

Nice Post Noel,

My SS files are little books... Avg. around 90 pages and then the folder has full documentation with Fax Transmission receipts / date and time of calls / etc...

Don't have the file... Sent to you on this day and time -- here is the fax transmission report. No update on the file in three calls.. Can I talk to your supervisor?

When you have full documentation and get a supervisor... you can make some things happen.

EXCELLENT LIST NOEL! You have hit all the key points exactly. Well done!

Great list. I feel like mailing this URL to the listing agent of one I have under contract.

Great Post! I too took the CDPE Training and have learned so much. There's only one thing that didn't tell me about in the course.

What does one do in the following scenario .... Got short sale listing, priced perfectly, sold in 5 days, seller accepted, i also put in place a 2nd and 3rd back up offer. I only sent ONE complete huge package to B/A ... now we're rollin.

Then this week the seller received a letter from B/A that must have scared the wits out of him, because he called and told me that ... get this ... he owns another piece of real estate that he forgot to tell me about when I asked about assets. When I asked why, he said ... "it was in anther county so I didn't think anyone would find out"?

What a business! My seller is just going to let it foreclosed upon. We cancelled the escrow and the listing and I'm not sure what to say to B/A? I don't want to be the one to tell them what happened.

Noel, from a fellow CDPE.....great post!

Many of you have been asking for the spreadsheet, well here it is: Listing Inventory It is in excel 2007 format, you may need a plugin if you have older excel versions. I have hyperlinked it in the main post as well for eaiser reference. Thanks again, keep the ideas and comments coming. It's really been a learning experience for me.

Noel Padilla, CDPE

I am studying a good deal before I handle one of these. Good information and I will keep on sutdying!!!!

Noel, Great list. Thanks for sharing the list and the spreadsheet. I try to do all 10 and realize #2 (being organized) is very important. The seller sign only sign one offer and we must update the MLS to show it as Contingent waiting on bank approval.

Hi Noel, Great post! thanks for the spreadsheet also. This will make things a little easier.. thanks for sharing!

I am a CDPE, but I have a couple of questions....

I have an offer in on a short sale where I brought the buyer and the listing agaent will not allow me to contact the negotiator handling the file. It's been a couple of months so far....is there something I can do? I would feel a lot better if I were the one in contact with the bank. The seller also has an attorney involved.

On the other hand, I have a seller who is an executive with BOA and can't go into default because of her job. Her condo is worth about 120K from the 400K she paid. She is not in default yet...but she insists that one of her bank clients in the same situation was allowed to negotiate a short sale with the bank anyway. (without being in default and without losing their job.) Is this possibly true?

Noel

Great post - if you don't mind I would like to copy this (noting you as the author) and include in my marketing as well as send to other agents. Like many others we interview the listing agent prior to sending an offer on a short sale - when it is obvious they have no experience we offer to take over the submission of the package to the bank and pay them a referral fee. That way we are in control of our buyers transaction. We don't take over the listing just the short sale approval process - we send them a new Borrowers Authorization form to have their client sign as well as our short sale referral fee agreement.

Based upon Mary Jo Quay's comment above...looks like the banks are expecting this short sale situation to conitnue on for a very, very long time. They would not be putting the investment into an online system if they thought we would be through this soonl...I have already been dealing with short sales for over 5 years and they waited this long to begin streamlining the process?

I also agree that #5 is not in the best interest for all parties involved...JMHO

Great list, thanks for getting it out to us at AR today.

Patricia AUlson/portsmouth nh real estate

Great pointers that are extremely helpful in dealing with short sales. Thanks for the post.

I have one that beats them all....the seller's spouse has fled the country. The seller's agent & I are now in the process of hiring an attorney in another country to obtain a Power of Attorney!!! Seriously!

I am working a short-sale on the seller side and another on the buyer side (the one above) and for exactly reason #6 I have vowed NOT to take on another one on either side until I have more training.....I'm not too pigeoned headed to get training....I was too new & eager was my problem. My mindset was "How hard can it be". I found out. It has been a CRAZY month involving these sales and it just gets crazier by the minute!!

Cheryl L. Miller
WEICHERT REALTORS - Advantage Plus
114 Lovell Rd, Ste. 102
Knoxville, TN 37934
865-470-7100 (office)
865-740-2198 (cell)
www.knoxvilleadvantage.com

Cherly, I have had 2 deals this year wher one of the spouses has fled and refused to sign. So, believe it or not this is not so rare!

Noel, Thanks again for the blog, it is getting us all talking and that is good.

Noel, I just closed a short sale with my buyer and it was a headache. The agent told me that she does SS all the time, but didn't mention that the listing was a short sale until after I submitted the contract. I knew her list price was too low, but she said the bank gave her the number, she also said that the bank told her not to mention in MLS that the listing was a SS. The entire process was full of inconsistencies from the LA.

I had to basically take over, as my buyers were getting very impatient. I requested that the Seller sign a a Request to release so that myself and the title company could work the deal the way it was suppose to. I finally got it closed and got my 3%. She only got 2% because I held her to her MLS commission amount, not to mention that she didn't mention that it was a SS and that the commission would be split.

We all need to be well-trained in this area, it doesn't matter how long you've been in the business. Short Sales are new to everyone and they are happening now, so a lot of the changes are occuring now.

Noel, Thnaks for the ten reasons. I am now moving away from bank owned REOs to short sales as a strategy to find bargains for my buyers. I will use your information in my efforts.

Noel - Great information! Now if all the agents listing short sales that don't have a clue would read it...well that would be fantastic! When you have the buyer and are dealing with a listing agent who thinks because they have been in business for x number of years they already know it all is a totally frustrating experience (especially when they can barely manage email).

Noel, spoken like a true fellow CDPE agent! As I read this, I thought what a great blog and how knowledgable the writer is. Thank you for educating the masses.

Karen Anderson, CDPE

I agree with Laura, there are far too many agents who take short sale listings that do not have a clue if the seller actually qualifies for a short sale. Just because they no longer can afford the property is not a valid reason for a short sale. It's one reason they may qualify, but if they have assets that could be used to satisfy the deficiency, that is something that needs to be explained. Another agent in our office asked me some questions the other day. She had been trying to do a short sale with BOA for 6 months with no success. I asked whether she had prepared her package and did she submit a financial statement, and she looked at me like I had horns. It turns out her client had plenty of money to pay this debt, she just didn't want to do it. The agent was spinning her wheels.

and how about item 3a. A buyer's agent who seems to let your warnings that we are in for a LOOOOONG ride go in one ear and out the other. The suggestions that she prepare her client for at least 3 months before we know much of anything is ignored. Maybe an informational piece that the buyer signs acknowledging the potential time frames involved would help.

Great list...Short Sales are a lot of work and take forever as it is!

My 2 cents:

A seller can only accept one offer. Period. It is a contract. You cannot enter into a contract to sell the same house twice. A seller can accept an unlimited number of backup offers. The seller is the owner: the lender is not the owner/seller. The lender may be in charge, but they are not a party to the contract.

No law requires that you send all offers to the lender. The lender is not the owner. You must present offers to the seller, unless the seller instructs you to stop. Again, the lender is not the owner/seller.

Yes, I know that others have mentioned these points, but I am saying them again because so many agents don't yet get it.

Wonderful post, Noel!

AUG

Regarding John's 2 cents.. if I throw in my 2 cents, pretty soon we can have enough for coffee!

When you have one offer before the bank, and you do anyhting to interfere with that offer (i.e. tell them there is another offer, send them another offer), you stand to be sued by the first buyer for 'tortious interference with a contract'. How's that for a mouthful?

I got an offer that I felt was too low and advised my client not to accept it, but sent it in to the lender anyway. They got started on the BPO right away and then a full price offer came in.....which I did have the seller sign and accept. I don't know if this is right, but it at least got the ball rolling and I was sure to let the buyers agent know that the low offer was below our expectations and that we would submit it, but not accept it unless the bank ok'd it. any thoughts?

Great post! I am in the process of trying to wrap up 3 short sales myself. You make some really good points. I especially liked your point in #5.

Noel,

Good post.

This is good stuff for those real estate agents that think they can just wing a short sale. I would add another key component, THE BPO. Every short sale is based on the BPO and too many agents wait for BPO to materialize out of the short sale process.

Agents, you will be much more successful if you do a BPO up front and submit it with the offer. If you don't know what a BPO is, take Noel's advice and edjamucate yourself.

I resent the inference that people in the business 25 years can't understand a short sale and only you can! Fax 50 to 100 pages? Who does that - turn it into a PDF folks cause the negotiators will love ya if you do!

Edjam i cate thyself.

LYN,

I don't believe Noel was saying that an agent with 25 years can't do Short Sales. To me, it seems the point he is trying to make is that some agents believe that because they may have 25 years in the business that automatically means they can do Short Sales, or any other specialized niche in real estate.

Someone with 25 minutes or 25 years of experience will do themselves, and their clients, good by getting a quality education in order to enhance the knowledge they already have. This market has never happened before therefore, without getting this specific type of education, you're not as good as you could be.

Experience does not always equal knowledge.

Lyn,

Old dogs need to learn new tricks in this day and age. If you didn't, you would still be running contracts instead of just faxing them, or you would still be using the MLS book instead of the MLS:)

Lead, follow, or get out of the way, Real Estate stops for nobody.

AUG

Lyn

You just dated yourself, lol. I didn't mean it that way. Like Sid said I meant that just because you have 28 years in the business doesn't mean you know what you are doing.

AUG

Great post Noel. Now if I could just forward this to all of the Realtors in my area

Noel:

Awesome post. We as an organization were so fortunate that agents like you were some of the first to attend the CDPE course over a year ago. You are a credit to our industry and I know you have done everything you can for the buyers and sellers in South Florida who need your help. Great list, great post, from an excellent agent.

Let me know what you think of the 10,000+ member video...

Alex Charfen
CEO
Distressed Property Institute, LLC

Extremely well done. I co-authored CRS 111 "Short Sales and Foreclosures; Protecting Your Clients Interest," and you are right on!! Your experience is evident, and thank you for sharing your knowledge with the World. I firmly believe that Realtors are the key to solving this housing crisis, and thank you for being a part of the solution

AUG

Great post and congrats on the feature. I wish all listing agents would submit the 1 highest and best offer to the bank rather than multiples! A contract is a contract between buyer and seller- regardless of 3rd party approval!

These are excellent tips, Noel, great info to get out there as a CDPE!

AUG

Great post and I would like to add to #4 - submitting low offers. Why would you submit a low offer. As the listing agent, your fidicuary responsibility is to ascertain the best price for the seller. Just like any other listing, if a low offer comes in, you negotiate it to an acceptable offer. In other words, make your Seller be involved, he still owns it and has a right to accept, reject or counter every offer. If a low offer comes in, reject it if necessary, and keep marketing it.

And #6 is right on the money. I see so many new agents take these short sale listings because they dont have anything and they flounder. Likewise, I have seen experienced agents take them to to bolster their listing inventory and then have the gaul to complain they cant get them sold/closed because they didnt know what the were doing in the first place. Swallow the pride and pass the file on to an experienced agent and collect a referral fee until you become properly trained and qualified to do them.

NOV

Great post. Looks like you put quite a bit of time into your blog post. Thanks

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