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Short Sale Realtors do us all a favor...

By
Real Estate Agent with Coral Shores Realty 3114510

To all the Short Sale Realtors out there who know what you are doing, this post is not for you... unless you want to shout AMEN!

This is to the short sale agents who are either unaware of the right way short sales should be done (and I don't mean my way, I mean in general) or have no idea about them and take a listing anyway...PLEASE READ ON!

I'm here in S. FL particularly in the Broward County market where it seems like half of the inventory (or at least saleable listings) are REO's or short sales. I spend a lot of time with buyers showing homes which also happen to be REO listings or short sales and I have to say you guys are KILLING ME!

What do I mean? Maybe it's easier if I list the things that most of the buyer's agents like myself are sick of:

1) You list the property at a price that is rediculously low even in this market-

I'm sure it's all peaches and cream for you and you probably do it because someone told you "it's a great way to get leads", or worse, you think that since it's a short sale "the bank will have to take any offer they can get". Puhlease people. This is a total time waster for you and ultimately burns buyers out if they can't trust agents out there to actually price the home according some concept of market value.

I'm not talking about having it 10-15% below a reasonable value, but some of you guys I've seen price things closer to 30-40% below market value! I'm not trying to rain on your parade, but all the BPO influencing in the world might not get that offer to closing if the BPO agent can't find comps or repairs to support the insane price you are advertising the home for. What's that? Don't know what a BPO is? Oops sorry about that.

Please keep in mind the bank will have the home appraised or do a BPO (there's that word again?) to tell them what kind of value the home has and it you are not even in the ballpark you are wasting a lot of time for yourself, the seller, and everyone else. If you ignore this it's could land your seller in foreclosure and they're trusting you to act in their best interest so do it!

2) You advertise the property as an "approved Short Sale" when it really isn't -   

This one actually looks like it might not be as popular as it used to be, but since I got you here to read this I don't want to take any chances. I wish I had a penny for how many times one of you said your listing is an approved short sale because the bank said they would "let the homeowner attempt a short sale" as if that meant you have the bank's permission to do #1 above and/or list the home, submit and offer, and it would be a faster process for your listing because the bank told you that.

Please do us all a favor and don't mark your listing as an approved short sale unless you actually have something from the lender IN WRITING implying that they will accept a certain NET amount from an offer that is realistic based on the market value of the home, and after reviewing an actual HUD (closing statement... just in case you didn't know) that shows that NET amount going to the lender. That would be a good example of an approved short sale in most agent's opinions and save a lot of people's time in the process.

3) You send the bank offer after offer instead of only submitting ONE at a time-

I know I'm going to catch flack for this one, but that might be the catalyst for change. Look, not that I should have to remind you of the way things work, but when you handle a regular transaction (not a short sale) the seller decides what offer they will take and which buyer they will choose to work with right? Well now make it a short sale transaction, the seller still owns the property NOT THE BANK and the offer to purchase is between the buyer and seller ONLY.

What you guys always tell me is "it's a short sale and the bank has to approve the contract so I need to send them all the offers I get" and sometimes you tell me "it's illegal to not send the bank all the offers" which I laugh at most of the time since this is just a big "misunderstanding" to put it nicely. The lender's sole responsibility in a short sale is to approve a NET amount they are willing to accept in the sale of the property. THAT'S IT!! It's NOT to accept, counter, decline, or otherwise make ANY decisions regarding the terms of a contract since they are not perty to the contract. They may do what seems like countering an offer by telling you they need to NET a higher dollar figure, but notice they counter in terms of their NET not the offer itself. They leave that up to you and the seller don't they?

 The seller, and you as their agent, have the responsibility to review the offers, buyer's qualifications, terms, etc and decide which offer is most likely to get the short sale approved and send that ONE OFFER to the bank. The bank needs you to do your job rather than flooding them with offer after offer and jamming up the operation. Once they receive the first offer it's also a good idea to let them get back to you with an approval or decline even if you have a better offer that has come in in the meantime. Then you have more options and they may even accept the first offer at a lower price and you could help the 2nd buyer get a better deal if the first buyer doesn't pan out. Just some food for thought...

4) You advertise a rediculously high commission to the selling agent -

 This one is just wrong! You should really think about it as bait and switch if you do this regularly. I'm NOT talking about the realtors who advertise a 3% commission or even a 3.5% commission since they may actually be able to get that done, but end up with a 2.5% co-borke commission. I DO realize that you have to put something in the MLS before you know what the lender will approve, but some of you put 4% or 5% and I've even seen 6% from someone on one of their listings!

I'm all for the power of positive thinking, but all my gut instincts say the loss mitigator at the bank has to be blind and drunk to let that slip by on the HUD (no offense to blind or drunk people of course) in order to pay that out to each broker. Unless you are being nice and giving up your side of the commission too? What? Didn't think so.

I've seen people get high commissions approved, and have myself gotten 7% even when I was the only agent, but I wouldn't set buyer agents up for a big disappointment and just tell them "the MLS said it was subject to lender approval" since you put the high amount to entice uninformed agents to make offers on your listing in the first place. Have a little decency.

 

Anyway, I hope this doesn't come across as complaining or whining (although I admit it reads that way), but I really think that we could seriously make a difference in the short sale process if we could either be informed of how to make them work or at least take people's friendly advice if we're not sure.

I'm open to comments as I'm relatively new to AR...thanks for reading!

Dustin Miller

Coral Shores Realty

www.DustinRM.com

 

 

  

 

 

Posted by

The Dustin Miller Team

7401 Wiles Rd #311A

Coral Springs, FL 33067

(754) 227-2258

www.DustinRM.com

DustinMillerTeam@gmail.com

 

Anonymous
STARLENA MEEKS

AMEN!!!!!!!!!! This is excellent, I want to print it and send it with my offers. You forgot to mention that they really should call the buyers agent back. I love it love it. Here is something to think about with the multi offers being sent to the banks, HOW CAN YOU SELL A PROPERTY MORE THANK ONCE?

Feb 03, 2010 12:44 PM
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