Another short sale closed this past Friday afternoon and we got paid.
On August 25, 2007, a student of mine working out of New York got a request from a Realtor in New York for help with a homeowner in distress in South Florida. The homeowner bought it in 2005 for $220,000.00 and got 100% financing. On August 27, 2007 I met with the seller and listed this two bedroom 1 ½ bathroom town home in Margate Florida. As of the listing date the seller owed over $235,000.00, which included unpaid taxes and missed payments. The property was tenant occupied by a friend of the owner, but the rent he was collecting did not cover the expenses of mortgage, taxes, insurance & homeowner's association. At the time of the listing there were 18 town homes in this community for sale with the lowest price being $185,000.00. The tenant was interested in buying the unit he lived in but he was not going to pay what the seller owed. The buyer offered $180,000.00 pays all and the bank countered with $185,000.00 pays ½ the unpaid taxes.
On November 9, 2007 we closed with the bank taking a net of $168,000.00 from which they paid $5,000.00 of the $10,000.00 owed in unpaid taxes. We the listing agent received our full 6% commission and gave our referral loss mitigation student 1.5% for doing the actual short sale, and we gave the Realtor that referred the client a piece of the pie too. This is what you call creating a win, win, win situation.
The banks loss was over 60K, but if they took the property to foreclosure, they probably would have lost much more.
Many Borrowers are finding themselves in the same position and when the short sale is presented to the bank the right way, we all get paid.
Since the real estate market has turned for the worst, a lot of homeowners have found their home is not worth 
what they owe and that there are no buyers knocking down their doors to pay what the homeowner owes.
If you don't need to sell your home and you can afford the payments, your best bet it to hold on to the property. We are all hopeful that eventually the market will turn around and your home value will go back up.
But what if you HAVE TO SELL?
Here's a day just like every other day. We wake up, get dressed for work, kiss the wife and kids goodbye and off we go. Little do we know that the road of life is about to throw us a major curve that will change our lives forever. Unfortunately, this happens to just plain average people everyday. Accidents, injuries, illness, loss of a loved one, divorce, job loss, downsize, or transfer. These are just a few of the reasons people fall into dept. As the bills pile up and the savings dwindle down, we sink deeper and deeper into the vortex of dept. Now the phone becomes your enemy! Every call is just another collection agency trying to get water from a stone. Just when you thought things couldn't get any worse, your home is plunged into foreclosure. Now comes the barrage of postcards and letters from Lawyers, Realtors and of course the Real Estate Investors with their all-too-common slogans:
"WE BUY HOUSES CASH"
"NO EQUITY NO PROBLEM"
"SELL YOUR HOME IN 7 DAYS"
"FAST CLOSINGS"
"SAVE YOUR CREDIT"
and of course
"WE CAN HELP"
Then, like ants at a picnic, they will be swarming all over you making endless promises, most of which they can't keep. It seems the one thing they all have in common is that they want to get your home with no money down, and giving you little or nothing for your home. With little or no choices left it's time to call on family and friends to help you out. Just when you think you've worked things out, all your plans fall apart. Now it's time to look at all that mail you have received and find the one-in-a-million that truly is different. The one person that truly understands what you are going through. The professional Realtor, with the knowledge and expertise needed to do a short sale and do it right.
What is a Short Sale?
A short sale is when a lender is agrees to accept less than the full amount owed on the mortgage in order to pay it off. The lender absorbs the loss. A short sale is option a homeowner in distress can consider to avoid foreclosure. The good news is that in many cases the lender pays the closing costs, commissions, title fees, and sometimes the costs to repair the property. The seller gets the home sold, the loan satisfied, and avoids having a foreclosure on their credit.
I can't pay my mortgage, what do I do?
Everyday thousands of homeowners find themselves asking this same question.
Step one contact your lender: By contacting the lender right away when you find yourself in a financial strait, you are showing them that you are trying to be responsible and not trying to run and hide. Ask your lender what options may be available to you.
Step two reach out to family members and friends: Don't let pride stand in the way. If you were in a position to help a family or friend that was facing a similar situation, what would you do?
Step three, call me: I am a Realtor that specializes in stopping foreclosures. In many cases utilizing the skills of a "Loss Mitigation Specialist" we can help you keep your home from going into foreclosure or stop a foreclosure process that has already begun. What can I do different then your cousin, friend or neighbor the Realtor?
•A) I can negotiate a forbearance agreement on your behalf.
•B) I can get your existing loan modified or restructured.
•C) I can put you in touch with a mortgage broker that knows how to deal with people in your situation.
•D) I can get you a privately funded bridge loan to carry you over a temporary set back.
•E) I can help you sell your home, if that is what is in your best interest.
•F) I can negotiate a short sale with your lender and help you get a fresh start.
•G) I can negotiate a deed in lieu of foreclosure with the lender.
•H) I can negotiate and restructure your other debts which may allow you to pay your mortgage.
But whatever you do, please don't do just nothing hoping this problem will go away.
If your financial situation is unlikely to improve in the next six to twelve months, a short sale may be your best option. There are downsides to a short sale and I will explain each one to you in detail.
Step four, consult an attorney: If you can afford it you should seek out the advice of an attorney that specializes in Real Estate law. I can help you find the right attorney. Bankruptcy is not usually the best option for most homeowners in distress.
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