I have heard over and over again from buyers and sellers that it isn't worth pursuing short sales. Though there are many challenges in doing a short sale--whether your a buyer or a seller--the short sales can be done successfully with everyone walking away happy. I know this because I have worked both sides of a short sale and have been successful.
As a Realtor, it is my responsibility to educate my clients on the short sale process, and to warn my them of the potential issues and frustrations. There are so many factors that can go into a successful or an unsuccessful short sale.
The Seller's Lender:
The seller's agent must have experience in short sales, and be proactive with the seller's lender. Submitting the financial paperwork to the seller's lender and then waiting will not get the process going. The lenders are inundated with short sales and foreclosures. The negotiator (the person designated to work a short sale in the loss mitigation department) could have 200 or more files on their desk. In speaking with several negotiators, I have found that they appreciate the experienced and proactive agents. It is my job, as a seller's agent, to get the negotiator all the documentation they need, to negotiate the offers and to stay in close contact with them. It's so important that we recognize that everyone working in the loss mitigation departments are overworked. Believe me, their goal is to get the deal closed and off their desk.
The Seller's Agent:
As I previously mentioned, it is so important that sellers work with agents that have experience in short sales. The current market is ever changing and without warning. As a result, I'm learning something new every day. If an agent is not working full time in real estate (which is not uncommon in today's market), or they do not stay on top of the changing market, they can delay or possibly derail the short sale.
The Seller:
As you can imagine, a distress seller is just that--distressed. The emotions that go into selling a home are amplified by the fact that the seller must sell or face losing their home. A successful agent not only is able to help their client through a successful short sale, but also must take time to listen and answer all their questions. In order to expedite the process, the seller must gather all the documentation needed to begin the short sale and get it to their agent as soon as possible. Open communication between the agent and seller are key.
The Buyer:
Attention buyers: If your agent educates you in the short sale process and have patience, you will be rewarded! Yes, the short sale can take months--sometimes up to 6 months to close. I do take the time to educate my buyers about the process. My buyers get it and have been very successful purchasing a short sale. I have been able to get my buyers' closing costs and termite repairs paid by the lender. In one transaction, during the home inspection, we found that there was a previous fire in the home and the roof was not structurally sound. The lender paid that too which costs $10,000! You will see that many properties here in San Diego have multiple offers. However, by the time the seller receives approval for their short sale, most of the buyers have walked and purchased other properties. So what is the key for buyers to successfully purchase a short sale property? Put together the best offer you can and wait! Most of my buyers do put offers on multiple properties (there is language added to the offer so they don't get more than one accepted offer). Once my buyer has an accepted offer, I formally withdraw their other offers (attention agents: please follow through with withdrawing your offer. It is a requirement and a courtesy for the seller's agent).
Short sales will be a large part of the real estate market here in San Diego for the next year or two. With that said, the short sale process has evolved and improved significantly. With lots of patience, short sale are being successfully completed.
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