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Short Sale

By
Real Estate Agent with Acumen Group Real Estate RI S29537/

 

     What a sad time when decent, well meaning people are losing their dream homes.  I have been working with a young man who one year ago, bought a 3 unit home in a great area of a local town.  He did not use a buyer agent and totally trusted a mortgage person that he began to work with.  Unfortunately this guy did not do much homework and believed the mortgage agent when she told him that he would have a 7% rate, $5,000 in closing costs and payment approximately $2,000 per month mortgage payment.  The home was owned by a friends parents, so no listing agent was involved either.  When it came time to close, the interest rate was over 10% and variable, the closing costs were over $10,000 and his payments were $3500.00 per month and going up.  He was able to hold on (barely) for about 8 months and then one of the tenants stop paying rent.  He then had to evict and could not make the mortgage payments any longer.  In the course of the eight months, he used all his savings and retirement money and put the home on the market.  We have dropped the price drastically and have done all the paperwork required to deal with the bank. (tax returns, paystubs, letter of hardship, copies of bills).  We finally got a very low offer that was vehemently denied and are at a standstill.  This guy does not want to foreclose and have this home over his head for 20 years, but its getting close.  Foreclosure is set for mid October.  I will let everyone know what happens, but I am frustrated with the entire process.  My seller realizes that he should have walked at the closing, but thought he had 3 days to rescind and of course then it was too late. 

People need to know that with any large purchase, consult a professional, get advice, do their homework, and be informed at the closing.  The attorneys are there to make sure every aspect is understood.  I am sad to know that this is probably not the last short sale I will be dealing with and it is a depressing thought for someone who really loves her job.

Comments (5)

Cynthia Mader
Long and Foster Real Estate inc. - Brunswick, MD
Shorts Sales are everywhere, I currently am handling 2.  It is unfortunate that buyers are not getting the full story.  It is also hard to make people understand we are here to help, not to steal from them.
Sep 11, 2007 09:22 AM
Susan Trombley
Trombley Real Estate - Wake Forest, NC
Broker/Realtor, Raleigh, Cary, Wake Forest, Youngs
You stomach just drops when you hear these stories or read about them. I treat my clients as I would like to be treated and I wish the mortgage person that did this to that buyer would loose his stomach.
Sep 11, 2007 09:22 AM
Anonymous
Anonymous

That's why people should always consult professionals.  Education is expensive....I sorry for you client, but I hope he learns from this

Sep 11, 2007 09:26 AM
#3
Anonymous
Chico P.

I can see how the homes properly staged will sell faster, but we have a totally different method of getting hundreds of lookers through a house. We conduct estate liquidation sales for heirs, executors, attorneys and individuals. We discovered that a house contents sale puts hundreds more people through the house than a traditional open house. We ask the brokers to attend the sale and take names. Almost every person coming to the sale, either wants to buy the house or knows someone who is looking. See our website: http://www.RhodeIslandEstateSales.com At the end of each sale we have the property cleaned out and swept by a local clean up crew of veterans who do the dump run and donate any leftover usable stuff to furnish new living quarters for homeless veterans. See their website: http://www.TrashCleanouts.com  We have expanded on this very successful method for flooding the house with people and now fill up empty homes with stuff and run a staged sale. Consider this messy but worthwhile concept!

Dec 23, 2008 12:31 AM
#4
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

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Oct 06, 2015 01:03 PM