One of the many differences in the Bahamas real estate market, and perhaps the most glaring, is that "short sales" do not really exist in the same sense as in other parts of the world. Often times when owners are forced into a foreclosure the banks will handle selling off the property and rarely, if ever, do they employ Realtors to assist in this task. You see, the laws here protect the seller of the home to ensure that whatever equity the seller has built up in the property is protected. However, what do you do when you list a home for a price less than what the seller owes with the agreement that the seller will make his mortgage company whole at the end of the transaction? Good question.
I listed a home about 4 months ago and when I concluded my listing presentation and explained my pricing strategy the owners agreed that the price I recommended was what it was going to take for them to be able to relocate. We all agreed, at the signing of the listing, that they were upside down but that they would pay the difference to the bank in order that the title of the property could be conveyed without encumbrance. Fast forward to today where we have received a full price offer and now the owner is squirming about entering into a sales contract. How frustrating! Now the owner is faced with the difficult decision of closing and taking out a personal loan to make the mortgage company whole or backing out of the listing agreement and paying the full commission per the listing agreement. What a terrible position to be in and one that I would love to avoid being a part of in the future.
I would be grateful if some of my ActiveRain friends would be kind enough to share their thoughts on this unfortunate situation.