Short Sale Revolution

By
Real Estate Sales Representative with Coldwell Banker, Vanguard Realty

I for one am ready for a short sale revolution! First of all when a lien holder sends my customer a letter telling them the benefits of a short sale as opposed to a foreclosure and how they should put their house up for sale what skin do they have in the game? What commitment have they made at this point? Let me think, none?

Now what they, do is tell us to list the house and let them know when we have an offer. Now there are folks who play the game send in bogus offers to generate the BPO or appraisal. Is that what level of professionalism we as licensed professionals should be reduced to?

I say if the Banks suggest the "Short Sale" then once the house is listed they should send out an appraiser and get on the same page with the seller and listing agent. They should then disclose to the listing agent what it is as opposed to it being Top Secret as some lien holders seem to feel it is. Tadah we are on the same page. They should then assign the file to the same person until the BITTER END!

Slot Machine 

Instead we blindly list the house, spending our money, not knowing where then banks brain is on this, price wise, or if the investor will even be on board. We pull the lever and hope for 3 of a kind. We sell the same house 3 or 4 times due to loosing buyers for (1) commission. Something is wrong with this picture.

That, or on top of that we pay a percentage of our commission to a 3rd party to handle it so we don't have to deal with it. Why do we do that? Because the process is so convoluted. The Banks could not even deliver a written policy to anyone that would be good for more than 60 days.

 I know I will be bombarded from all the 3rd party short sale negotiators on this post. Nothing against you , it's not my point! I realize that many of you are a great help to agents everywhere and some of you have taught me a thing or two!

My post is directed to agents. Why? Because the banks operate in madness many agents give away more commissions to get the job done. They are so bogged down on the phone retelling their customers life story to someone that doesn't really care, instead of out selling real estate. We should not have to hire out and pay from our commissions what we have spent a lifetime building (a real estate career) because the powers that be don't know what day it is.

Unfortunately many good agents in our area have got involved in the more lucrative simultaneous closings where the 3rd party investor negotiator becomes the trustee and the listing agent lists for them and then finds an end buyer that the lien holder never knows about it. The agent gets double commission on this and both deals close at the same time. The concern is that NAR says this is wrong on so many levels. The picture below is from Fannie Mae. The seller even cluelessly signs something that says the house will not be sold in the next 30 days.

Mortgage Fraud

Why is all this happening? There is no clear process. The NAR has been slow to rule across the board, all the while the FEDS are investigating Fraud on every level. Meanwhile as Realtors we are working hard for our customers to get transactions closed and keep up with the ever changing rules. Why can't we as an organization call on the industry to streamline the process that THE BANKS so eloquently encourage our customers to do! No worry we'll list the house that we're not sure is "For Sale"

Why do we dance to their song. Spend our money, energy and frustration? The worst is when the give out our phone numbers when it's done to bill collectors because our name was on the file. Anyone have that happen yet? I just had to throw that in there.

 For the record in the last 12 months I have been able to close 16 short sales on my own besides my normal resale inventory. Not very much compared to many of you I know, but enough to have a taste up front and personal. I have been on the other end with buyers more times that I care to. I am happy to say that more and more buyers are looking for houses that are "For Sale".

Bottom line something has got to change!

Comments (3)

Kim Curran
RE/MAX Unlimited of Northern Virginia - Bristow, VA

Kim-

Couldn't agree with you more on somethings has got to change. One of my clients has had an offer in for almost 60 days with still no word. Of course we are still out looking for homes since we have no idea if the short sale will close or not.

Jul 30, 2009 12:50 PM
Melissa Zavala
Broadpoint Properties - Escondido, CA
Broker, Escondido Real Estate, San Diego County

I am not going to bombard you, but I am going to add my .02  Barack Obama laid out a plan (the long and convoluted stimulus package) whereby contributing lending institutions (those that got bank $$$) would offer an incentive to those who opted for short sale over foreclosure. (This I understood to be a cash for keys type of thing where the seller would get a little bit of money at close of escrow.) Here's the rub: this would be great for agents, but I cannot find a single bank executive in a single corporate officicer who has a plan for how this works or claims to be offering this incentive.

My point is about the above and also about your blog post: it would be a heck of a lot easier for us to all do our jobs if the plans that came from the top were put into action by those at the bottom.

On a side note, at least Fannie Mae agrees to always pay 6% on short sales. Hopefully the others will follow suit very soon.

Jul 30, 2009 01:13 PM
Brian Griffis
Realty Choice - Springfield, MO

Melissa, you are missing the flip side of that stimulus coin.  The administration also gave hundreds of billions of dollars to bail out those same banks, so why would they be so hot to do a short sale now?  They know they are covered either way, so they don't want to let a homeowner off the hook.

Aug 03, 2009 01:19 AM

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?