So you've gotten a new lead on a listing: Someone who knows someone who knows you, finds you, and wants you to list their home. It's a small one, but it's in a popular neighborhood and a small paycheck is better than no paycheck, right? Then you find out the seller is upside down and does not have the ability to write a check at closing. So now it's a short sale - congratulations!
Whether you're a short sale expert, what just happened is, you took a pay cut. I figure you'll spend 2-3 times as much time selling that property, and sometimes a lot more. And once you've gotten a buyer, submitted all that paperwork, spent all that time getting an answer and negotiating ... the deal doesn't work out and you start over. When you finally put one together that looks like it will stay together, the bank comes back with, "Oh, by the way -- you'll need to cut your commission to 4%."
Hey, a small pay cut is better than having no job, which is the boat a lot of people are in, so don't complain, right? Except this is not a small pay cut. If you double the time required to perform the job, and cut the compensation by 33%, that means that by the hour, you're making 1/3 of your former rate!
Ouch! So Cynthia and I were lucky enough to be in the right place at the right time and met an investor who buys short sales exclusively. He has a professional negotiator and a dedicated BPO person, and they negotiate a below-wholesale price from the bank, then resell the property at wholesale and pocket the spread. The negotiator does her best to get the bank to forego deficiency judgements and promissory notes against the seller, and is willing to use a portion of the spread to buy those concessions (win-win).
The best parts of this are, the process is much faster, the success rate is much higher (which means fewer sellers going into foreclosure), and the investor's staff handles all that time-consuming negotiation with the bank(s), and does a better job than I could. That frees me up to stick to what I know, which is real estate! The commission paid is almost always much better, too.
Wrangling with banks was not what we got into real estate for. It's nice to feel like we're in the RE business again -- and short sales are no longer a headache. People need help, and we can give it to them again -- finally!
By the way: If you're an out-of-town realtor with contacts in our area who need to short sale -- send them to us and we'll give them their best shot at staying out of foreclosure AND pay you a refrral fee. Ditto if you're a local realtor and you have a short-sale candidate you don't want to handle for whatever reason.