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Why do Short Sales?

Yesterday, Janie Coffey and I were invited to participate on a teleconference hosted by Jennifer Allan about short sales. If you didn't tune in...here's the replay (Please remember this is copyrighted material so check with Jennifer if you want to use it).

My portion of the seminar was........Why do Short Sales? I was fist so please check it out and let me know how I did. I've only done two of these seminars so I'm still trying to figure them out. What I learned this week is that I talk too much!!!!

Here's a very small portion of the transcript.

You've probably heard...."Short Sales are difficult and a big waste of time" and "Rarely do they close and when they do you don't get paid". I

If you believe these statements to be true then one of my goals with this seminar is to prove you wrong.

Listing and selling Short Sales is all about helping Home Owners in your Community salvage their credit.
It's about helping real live people with getting through a difficult time in their lives.
It's about being there for them.

Think of all the people you may have sold homes to over the last few years when the market was booming. If these folks are now struggling don't you owe it to them to help them out?

If you don't want to help people and just want to do Short Sales to make a ton of money then do me a favor.....quit reading this post now and just move on.

People are hurting and they need SINCERE agents to help them. OK? Instead of resisting Short Sales you need to be learning the skills it takes to become the "Go to person" in your community. When a Home Owner needs help they should be calling you.

You should be attending seminars on Short Sales and reading everything you can get your hands on to increase your knowledge of how Short Sales work.

The Short Sale process is changing daily. Get into the game. Every time you get a Loss Mitigator on the line.....pick their brain. Call the Lenders and talk to them. Ask them for their "Short Sale Package and Guidelines". Talk to other agents who are successful at Short Sales. Constantly be asking questions and learning. You'll never know it all but you can know enough to help.

This current market is full of opportunity for REALTORS(R) who are willing to help and willing to learn. Home Owners need you. In fact, there has never been a better time for a REALTOR(R) to show their worth. If you have the right skills you can not only help a lot of people but you can also make a lot of money doing it. So get out there!!

FAQ #1 What is a Short Sale?
FAQ #2 What is a Hardship and why do I need one?
FAQ #3 What goes in the Hardship Letter?

DISCLAIMER: I am a Florida Licensed Real Estate Broker. This article is my opinion based on years of experience and the laws of my State. All Sellers are urged to seek competent legal and tax advice. I am NOT qualified to give advice in those areas.

CENTRAL FLORIDA REAL ESTATE SHORT SALE INFORMATION

Don't Sell Yourself Short. An E-Book by Broker Bryant. Coming soon!!!

MORE INFO FROM BROKER BRYANT... THE SOURCE FOR CENTRAL FLORIDA REAL ESTATE

Posted by Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc on 03/08/2009 06:36 PM

Comments (61)

Short in the Training Channel

short sale, teleconference

Originally posted at: Central Florida Short Sales: Why do Short Sales?

61 Comments on Why do Short Sales?

MAR

Reserved Parking For "The Lovely Wife"...TLW...ROAR!

Hun...

You did great and I do believe you're ready to fly on your own :)

TLW...ROAR!

BB, I heard the teleconference. There was so much information, my head was swimming. I downloaded the file that was sent today.

The other day I heard an agent telling another agent how easy short sales are. I winced, you can rest assured that this agent has not done any homework.

Also, I thought what you said was fantastic, that we should be looking at short sales as a much needed service. And yes, if we did sell a house to anyone over the last few years they may need our help. Very good point.

Thanks for the post, and thanks for the teleconference!

I'm a buyer's broker. I sell short sales because they offer good value for my buyers. That's the best reason I can think of.

So you have to be patient. So what. If a buyers needs a quick occupancy, they should rent short term or come to my house. I've got lots of room.

If an agent can't wait for the short sale process, they won't be selling new construction either. I love new construction. My last new construction took 14 months. My commission was $31,000. Worth waiting for.

Just write a decent offer, have a well qualified buyer, have a good lender who knows short sale needs, wait and when you hear from the listing agent, get them what they want quickly.

In the mean time, keep looking. You can always sell something else if a better property comes on the market. Until you get the approval letter, the buyer can walk. You don't have to pay for inspections until you know they're going to get the property.

Don't sell short sales to marginally qualified buyers. That's risky.

Work them. You're buyers will love you.

Darn, was that yesterday? I missed it. Thanks for the link. I've chatted with Janie in the past about short sales and she's provided some great tips. Looking forward to the double whammy of the two of you. Thanks Broker Bryant.

I have one going right now, and I am guessing more to come.

I will review this info, thanks!

Thanks for the info Bryant. I will check out the links you have here and do my "homework". My broker is pushing the new designation class for distressed properties. I will be checking that out too.

Thanks for a great Blog Bryant. I too work short sales and my MAIN concern, really my only concern is doing what I told the homeowner I would do.... Help them out of their situation. The commission thing is the last thing on my mind. I do know from experience that once you help a homeowner out of a tough situation, they WILL remember you forever. They will buy another home again and they will remember you.

Thanks for great information, I plan to listen to the teleconference

Brian, you're right, they might not be easy, but your client will hopefully appreciate your efforts.

I agree short sales are not for everyone. You do have to learn patience if you don't know how to wait for things.

I think agents may not like to list short sales because they do involve more paperwork, more running around, more follow-up with the lenders, in short, more effort. However, if a buyer has the time and patience to wait it out, a short sale can very well be worth his time. I recently helped a buyer close on one that he waited full four months to get an answer from the lender. There were some hoops to jump through on both agents' sides but we got it done and everyone walked away happy!

Bryant, I was listening yesterday, and as far as I was concerned, your talk could have been twice as long. You're a natural, and everything you have to say is VALUABLE. Do more!

I was on the teleconference yesterday and I thought you did great. There was a lot of great information and I really appreciate you, Janie and Jennifer for taking the time to share your expertise.

Thank you SO much for this great post. It is very important that we help those with hardships get where they need to be.

Short sales aren't for me, that's for sure. I haven't the patience for this kind of sale. I'll leave it to someone else.

Patricia Aulson/ Portsmouth NH Real Estate

NICE POST - some short sales are definitely worth it, but some are just terrible to do. Hopefully, as this crisis depends, the banks will get more efficient.

BB---when I read this I stopped reading....that is all I needed to know as a consumer and/or a professional that participates in short sales. Your motivation is clear, and appreciated by many.

I haven't listened to the replay, but I know if you're out there explaining that there is an individual behind the short sale that needs you, I hope that more people pay attention.

Well spoken.....very well spoken.

BB - Well I'm listening as I comment. Excellent. I couldn't listen in live but who cares. I still get to hear from the short sales experts. They are a big part of reality (realty) so we need to know as much as possible. The more I learn the more I know I need to learn.

Jeff

BB - I didn't listen to the broadcast/podcast/your voice over cyberspace. However, I will say this: if I wanted to be a social worker making only subsistence wages because I just love people and want to help them I would have chosen a different career path.

I'm all for helping people make great decisions about their homes based on thier lifestyle and the availability of homes that match their criteria in the marketplace at any given point in time. I'm all about consulting with potential home sellers and home buyers about what course of action would best help them reach their goals, objectives and aspirations.

It's bad enough that the "general public" that is not in trouble with their mortgage doesn't want to compensate us fairly anyway. It's bad enough that there are disloyal buyers or financially unqualified buyers or buyers/sellers that have totally unrealistic expectations. Now, I'm supposed to be their social worker? ....not.

A lot of the commenters to this post talked about patience. Fine. Realtors can afford to be patient. What about the home buyer? The guy looking for "the deal" and wants to move in and set down roots, call the contractor to fix up the place and put the kids in school? How much patience can we instill in them. They want "the deal" and they want it NOW! What will happen to interest rates in the time it takes to consummate a short sale, other factors in the buyer's qualification "package"

I wish I could be more spiritually correct like many of you. Unfortunately, most of the short sales in my neck of the woods have low sale prices (even if the banks didn't bite into the commission anyway) and my house isn't big enough to rent to all my buyer "children".

People talk about "personal responsibility" on one hand and then say " let's work for free" to help these folks who made bad decisions on the other.

Can you tell you hit a nerve?

Ken, Who works for free? I get paid on every singles hort sale I list. Not only do I charge an upfront fee but get all of them approved. Not all close because shit happens but it's not because I didn't do my job. My short sales close in about 90 days from time of listing. But I certainly think we have to be picky with who we choose to work with.they have to have a legitimate hardship. I don't work for folks who are just trying to avoid their responsibilty.

OK great comments eeryone. Judy....you made my day!!!!

I'll be back.

I couldn't agree more with your comments!!! I only wish there were more dedicated and knowledgeable real estate agents willing to work with short sales. It would go a long way toward improving public opinion about our profession and speeding the recovery in the markets we serve. Keep spreading the good word...

Lenn already figured out the commission thing via the Fannie Mae Servicing Guide- I feel for Sellers/buyers/ Realtors outside of the parameters. What a nightmare.

Except, in any market, the service end is accepted by those who have seen a few downturns, and understand that what goes around...

Bryant - Great post on short sales ! Sorry I missed the call ! Will listen to the replay when I have a moment. You did a great job on the CMA call as well. We do a decent amount of short sale biz and agree with your post 110 percent !

BB, excellent post! I'm disappointed I missed the call but I'll def be checking out the link ASAP. I enjoy short sales. Call me crazy but I think the challenge makes me a better agent and helping people in real need does my heart good!

BB, It all sounds so wonderful. I just wish the lenders would work with us here in Texas. It's just not happening. They seem to hold onto the loan till it's much too late to do anything. They are happiest just to "not return the calls" till they can say, "ooops, sorry, if you had only gotten to this sooner..."

Any ideas? Help.

Later in the rain~Deb

BB - I think you have hit on the most difficult part of the short sale - the human element. The hardest part about working on a short sale is that many nice folks have problems and we just can't help everyone.

Marlene

Thanks so much for posting the link so I could listen. I registered and then a listing appt took longer than expected (but I got it!) I'm sure you did a great job, you were great in the first one.

Very informative post! You're so right that there's more to come in the ss arena and if your going to survive in most areas it would be worth educating yourself today. I'm bookmarking for tomorrow morning when my brain isn't mush and I can enjoy a cup of coffee with the audio! Best to you~

Bryant...

Whew, today is short sale day! Janie and I have had quite a discussion on the subject! Seems like there is still a lot of confusion about the subject!

Byrant- Well, you know I don't have to tell you how I feel about short sales:) I remember when you were resisting doing them and then well, they grow on you as you see how much you can help another, dont' they! You are a great example of how you can turn things around for yourself and others. Great job!I am very proud of all you are doing in your community.

Bryant - I think it is our civic duty to help people with short sales. If an agent doesn't have the knowledge/stamina to handle them and some don't, then refer them to agents who are competent and diligent to get them closed. These people are in crisis and some communities are in crisis. The sooner we get families in these houses the better off everyone will be.

BB-I will listen to your teleconfernece tomorrow, but in the mean time, I think its a great idea charging an upfront fee. Do you mind my asking how much your fee is? I've just recently began to notice short sales popping up more frequently here in Huntsville. The past few weeks I've seen MANY more than ever before.

BB ~ Listened to it myself, good stuff. BTW, you weren't the only one in denial!

Oh, one more thing. I read a post earlier that mentioned an agent had recordings for their REO properties, as to if they already had offers, etc. I think that would be a great tool for you to offer as well. I know I have shown a few short sales only to find out they had an offer in to the lender already.

I do short sales because that's where the money is in real estate right now. Sellers need our help, and buyers want to buy. What better reason is there? If you're in real estate, this is what you do.

We have so many short sales in our area that is would be foolish not to work with them. And you are right, some of the short sales I have done lately were from past clients, clients who needed help and advice. It just wound not seem right to refer them to someone else.

Bryant,

Excellent!

Let me added from the buyers side, buyers are also helped! Purchasing a short sale can often provide greater opportunities that even REO's can't offer.

Lastly two and a half percent may not be your normal fee but it's a lot better than a sharp stick in the eye! Not to mention Fannie Mae now allows 6% om short sales, ask any you may receive.

Brokers who are to good to work short sales in today's market deserve to starve.

Bill

BB,

It's a strange world right now, and you're so right in your post. Congratulations on the feature, and thanks for the links.

Mike in Tucson

Great post

I have saw some weird things going on with Myrtle Beach short sales recently

I think you are exactly right to talk about embracing the short sales rather than avoiding them. They are going to be here for quite some time. I have not been on the listing side of them yet, but have brought buyers to short sales. With patience and a little extra elbow grease, it can be a satisfying way to help people out!

I didn't get in on this one.. I need to in the future.. Thank You for sharing..

BB, You certainly have become Active Rain's Short Sale Expert! I'm telling you, you've come a long way with your expertise--it makes me realize just how FAR behind I am on this! I have enough business to keep me busy enough to keep me out of short sale classes and, as much as I wish that we didn't need to be experts in this 'field,' we're doing clients an injustice if we attempt to do these without the skill and know-how that you have. Not only that but, it's a HUGE liability if you don't know exactly what you're doing.

Congrats on that little gold star too and thanks for sharing your wealth of knowledge with us!

And, give TLW a hug for me too!

Debe in Charlotte

Broker Bryant, good job on the tele-seminar! I heard a little but will listen to the replay. We all hate doing short sales, but since they're driving our industry right now, we might as well get used to them -- and learn to do a good job for our clients.

Join my new AR group and post your blog at http://activerain.com/groups/virtualoffice

Regina P. Brown

Okay, if it were anyone but you, I would NOT have come back to this very serious post and do this but, I just HAD to share my "secret word" for my first posted comment on AR just now! TLW, this one's for you:

BB's Secret Password

Debe in Charlotte

LOL @Debe !!!!!

Mr B !!

I'm totally with you and I think some who are not necessarily working Short Sales so efficiently may buckle at committing 100% to them.

I have been involved with 4 SS this year so far and all have been approved. 2 were my listings (one closing tomorrow :o) and 2 I have the buyer. But even when I had the buyer, I partnered with the LA to assist the process to help cover all angles.

Like you and Elizabeth, I am comfortable with short sales and the opportunites they offer, so great job with the podcast and being generous to share this info.

Cheers !

Sheldon

(oh and dare I ask what the heck a 'goatnut' is ??? )

MAR

I'm grateful for the link to hear what you have to say. SHort sales are here for a while and the more facile we become the more short sales can increase our income streams. Maybe one day the banks will start to make it a little easier. After all, it's their money. LOL

BB,

I've still got a few on the ropes right now...I'm being a bit more selective in the ones that come to me...more like a consultation...if the odds look good then I'll take them...it really has to have a lot in the equation for the odds to raise a successful closing. I really try to let the clients know what to possibly expect...if you don't drill it through their heads then they might expect too much. I also try to stress the same thing to the buyers agents and their clients...sometimes they just don't listen and sometimes they claim to know the process...it doesn't help for them to call you every day for an update...it just doesn't happen that way. You have to be really patient.

BB - I missed the call, but really appreciate the link to listen to the call.

I spoke to a family over the weekend about their situation and folks are really overwhelmed and need professionals like us to turn to. Short sales aren't fun, but I feel compelled to do them.

Short sales are not as common here as they are in many other parts of the country...Know what you don't know...and don't learn at the expense of a distressed homeowner !

Charging an upfront fee... now there's an idea! If they aren't making a mortgage payment, they've got to have some kind of extra money laying around. That in addition to being a little bit more picky about which listings we take on.

H Broker Bryant, very nice and some great information. Short sales can be a win for everyone concerned if done correctly. I don't mind them a bit. Understanding is the key. Congrats on the feature too.

Bryant - short sales are a way of life here in Pinellas County - I don't see how any agent can survive in this market and NOT do short sales!

One of the most important things to remember about Short Sales...

You do have to pick and choose with whom you work with. If they're not motivated things can quickly turn into a disaster. All parties need to completely understand what they're doing. Some of you may have seen a post floating around this weekend where one of our own was having serious problems with her short sale customer. That was sad simply because it's an unmotivated Seller. That doesn't work in a short sale. Know you stuff Guys and if you have to turn away a few, then do. Do it for them and do it for yourself. We can't help everyone but we sure can try :)

That's all folks...Back to the Crap-A-Rama I go :)

TLW...ROAR!

Yes, short sales are difficult and time consuming. But worth it.

Some people in trouble don't even know about them. I am working with someone who was just about to walk away from two homes. At least with a short sale she will only ruin her credit for two or three years, not ten

Bryant, thank you very much for sharing the relay. I am listening to it while eating my lunch. I will put it in my car and finish the whole show.

I am on the same boat as Lenn... although I list Short Sales as well. So what if it takes time... it is just a waiting game, and if my Buyer's can wait, then they will reap the rewards of good negotiation skills.

If they(agent, not neccesariy BB) can't wait for a $ check... then maybe they should work at McDonalds. I heard they pay either every week or two.

BB - This past Saturday was another learning experience for agents and for myself, who are interested in short sales. I'm taking it all in, read everything I can and have been in the past. Active Rain is surely a great resource of valuable information. You are a true inspiration when it comes to helping motivated sellers, who are in dire need to sell. I'm glad you are in my neck of the woods so what I read and learn applies to Florida. Thanks!

Listened to the teleseminar as i was going to bed. Thought you did well though it sounds like the main reason to do short sales where you are is because that's mostly all there is. We've got some funny laws in Hawaii (not really funny) that prevents realtors from helping with short sales if the clients are distressed ( 60 days late). The law says we can't talk to the banks OR give the clients any advice. Makes it a little difficult don't ya think?

Great conference, Jennifer!

Two very knowledgable professionals. I work in Florida and agree with the current information provided by these professionals.

The time was short for explaining every facet of the process and the unintended consequences of the short sale arena. I would like to hear more from these two experts!

I liked the format for delivering the material and moderating the questions by Jennifer Allan went perfect with so many guests on line.

Here's a funny thing that happened at a recent short sale closing...the closing was scheduled and the buyer's loan package was at the settlement agent's office...the Uhaul was loaded and now parked infront of the home to be...the time for closing was in 2 hours and the short sale seller called the settlement agent with 1 hour to go and she said, "I have been advised to not sign a deficiency judgement for the short sale on my home and won't be coming to closing."...it did not close.

Having real professionals with real experiences in short sales like Bryant and Janie are a valuable resource in our community of professionals.

Great job!

Hi guys. I appreciate everyone stopping by and commenting. I have read each and everyone of them.

When I first decided I needed to start doing short sales I was not excited about it at all. Then I did a couple and realized they weren't that difficult. Now I LOVE them! They are very challenging and make my job more fulfilling than it has been for quite a few years.

The key to being successful is to screen the sellers thoroughly before listing the property so you only work with motivated and qualified sellers. AND be sure everyone understands the time frames. A buyer that MUST close in 60 days will not work. All this buyer will do is cal you every day and create stress.

Sellers must have legitimate hardships and buyer must be highly qualified and have patience. If you have these ingredients you will have successful short sale closings.

OK it's 8pm and I have been on the computer working since 5:30 am. I'm shutting down.

MAR

BB this is my ring I wear when meeting with the buyers who want to call every day. I chant silently "I will only call every 5 days" and touch them slightly on the shoulder. So far the results I have gotten? A slap, an offer (and not the kind I was looking for ;-) and a very confused look ;-) Great post!

MAR

I finally got a chance to listen to this webinar last night. Great info. I still hate doing short sales though, but even us Realtors gotta eat.

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