The Constipation Effect of Short Sales
Kristal Kraft has provided good insight on the short sale process, and the comments are interesting to read as well. We have a long way to go in this country before we start seeing FEWER short sales -- years, probably. I figure we might as well get good at doing them, and that means, as agents, to continually improve on our own processes for handling them.
Not that I need it, but validation in always nice. This week I wrote about short sales in the Denver metro
market. Today John Rebchook of the Rocky Mountain News follows with a good article discussing short sales along with quote from fellow real estate associates.
There are agents who make a living chasing the short sale and foreclosure markets. They of course are advocates of the process. Many others feel the opposite, short sales to them are a waste of time.
Jim Smith, owner of Golden Real Estate, had this to say about them this week in his online real estate column: "Having listed a short sale myself, I have experienced this colossal waste of time, and I'm no longer willing to list such homes."
Smith said banks won't tell you the amount they will accept until you bring them a "live" contract, and the deals usually fall apart because it takes such a long time to get an answer from the lender.
Lou Barnes, principal of Boulder West Financial, agrees. There are so few short sales being completed that they aren't worth the effort, Barnes said.
"I was teaching a real estate class and I told my students that they would be better off doing their laundry than wasting their times on short sales," Barnes said.
I believe the entire short sale process is congested with unrealistic bids on properties. True to the business, the bottom feeders come out, placing bids on properties that have no chance of ever getting accepted. Yet these bids are presented to the banks and gain a position on the desk of the short sale administrator.
What happens next takes forever. The time involved to get to the file often fends off real buyers. This sort of frustration causes a ripple effect that resonates through all parties in the transaction.
No body want to waste time, money and effort on a useless cause. It gives the industry a black eye.
What needs to happen with the banks is more efficient organization. A front-end traffic cop that looks at the file, knows the banks break-even, bottom line number and immediately sends the offers without a breath of hope packing.
Get the useless crappy offers off the desk!
By making sure only the bids that have hope and potential of getting accepted you loosen up the time restraints on the over-worked administrators. Giving them an opportunity to do focus on getting their job done will help the industry. It will save countless wasted hours, many disappointed buyers and send near-bankrupt and distressed homeowners away so they can rebuild their lives.
We need one thing right now.
That is consumer confidence.
May we have some Please?
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