Short Sale buyer be patient!

Ok, so you have a client that is wanting to buy a short sale. Great! Here are a few things that need to be laid down with them in order to prepare them for the purchase of a short sale. This is going to be a wonderful opportunity for your clients to get a great discount on a home and you need to know how to prepare them for the purchase. I spend a bulk of my time trying to negotiate with banks that are acting like children the last thing I need in a short sale is to baby sit buyers. This is not meant to be rude, but is what all buyers should be aware of and things that you need to help them to avoid during the process. Short Sales are not for all buyers and when I say that, I mean less than 4% of all buyers in Idaho in this current market are buying short sales. That leaves 96% of the population will avoid it due to the following.

1. Explain the worst case scenario: Please do not miss lead a client by making them think that this sale is like any other buying experience. Let them know that there is a possiblilty you may get 3 months into this and lose the deal and be back at square one. It happens more than it is talked about!! No one wants to be the agent that delivers that blow, but if you do your job and explain up front the possibilities, your clients will not blame you when the ball is dropped.
   
2. 60-90 days for a response:This is not a misleading statement remind your buyer of the time frames involved in buying a short sale. I cannot stress enough that this is the number 1 thing that buyers are not gettting from there agents. 95% of all short sales fall into the 60-90 day category for an offer to make it through the banking process. I know that you have heard of the miricale closings that got done in 30 days, but we all know that those are to few and far inbetween.
   
3. Make an educated offer: When buying know this! 88% of current market value is the statistical average of what a short sales are sold for. Yes some go for less and some for more, but 50% offers are a waste of everyones time and rarely get accepted. Please do your home work and find what the current market value is and make an offer based on those numbers. No bank in its right mind will take less for a house in short sale than they will get for it as an REO. If you are having trouble coming up with what that number is, ask the listing agent there opinion, or find yourself an agent that is specializing in Short Sales and have them show you how they arrive at there pricing. 
4. Stop shopping for homes: Please I emplore you to make your clients stop looking, the number 1 reason that clients walk away from short sales is because they are afraid they won't get the short sale and never stopped shopping. When your client commits to buying any other home on the market, do they have the option to shop until they drop? NO!!! They are done, committed and are awaiting the process of closing. Reassure your clients that things are getting done on the otherside by talking with the agent. Get up dates weekly!! It is an absolute frustration to get 70 days into a negotiation for a contract and get a call that the buyers have made an offer on another place and will be pulling there offer from you.
5. Screen the listing agent: If you were about to charter a private plane to fly somewhere, wouldn't you want to know that the pilot has all his stuff in order to make that flight? It is no different when buying a short sale. The listing agent has a complete check off list that the bank will require from them to submit with an offer to purchase. If this stuff does not get submitted with an offer the bank will do nothing with it until they have the rest of the paper work. You need to findout what the bank is requiring and make sure the other agent has there stuff together. If the agent on the other end cannot answer your questions, it would be best that you offer to help them or make your clients aware of the possible bad situation they could be facing.
   

I hope that this was somewhat helpful. I know that this is not all that is needed to be know when buying a short sale, but these were the ones that have plagued me and I feel that by sharing maybe we can all get up to speed with this mess we have to deal with.  Your clients will truely appriciate knowing this stuff, you will be more knowelgable and you will have more confidence in them as buyers to make the right decision to puchase a short sale if they choose. Good luck and I hope to find you on the other end of a transaction someday!