After a year full of short sales and feeling totally fed up with them, I've come full circle. I'm loving short sales for the satisfaction I get, similar to a first time home buyer. I'm enjoying the negotiations and the process... at least on the listing side. If you have short sales you want to refer, call me!
Having completed several this year, I can tell you why some short sales fail. There are two main areas:
HUD STATEMENT
- Closing times on short sales can be long. A big mistake agents make is estimating a 30 day close. Some short sales can take up to 6 months. Make sure you overestimate your closing period.
- Assuming that the second or third lien holder will take a certain amount. Always assume the worst. Overestimate.
- HUD is simply incorrect. Nothing is worse then spending hours trying to get an approval to get one and then show up at the closing only to have it change. You aren't likely to get that account manager on the phone let alone have them jump to sign off on a change at your closing. It's probably coming out of the real estate agent's pocket.
Word of the day, over-estimate. That goes for commission too.
BPO (Broker Price Opinion) is neglected
- The bank wants to know what the value is, so they send out a person to evaluate it. So you make it tough for them to see the inside. They do a drive by BPO and it comes in much higher than it should. Deal is dead.
- A lot of BPO agents don't really know the market, are you helping them understand why the price should be what it is?
Some final tips
Utilize your advocates. Is this a Fannie Mae or Freddie Mac home? Call them to get them involved. The PMI companies want the short sale to happen too, get them to put pressure on the bank as well.
Short sales are a lot of work but they are far better than a foreclosure for clients.
I'll still pay referral fees for short sale referrals! Put me on your speed dial 770-374-4667.
Comments(7)