Whether you are the buyer OR the seller, participating in shortsale proceedings can try your patience, but can be less stressful if you are working with the right agent. Shortsale transacting is defineitely not for the non-dedicated. I am therefore going to lay down expectations of operating on both sides of the transaction. IN ALL CASES MAKE SURE YOUR AGENT IS ACCESSIBLE. My clients will call me late at night to check in and they know I will answer them. Do they have a specialization , either Partner First Preforeclosure Certified or the more common Certified Distressed Property Expert certification?
IF YOU ARE THE BUYER...
All I must say is to hurry up and wait! Well ok there is a little more to it than that. Shortsale proceedings are dependent upon the bank really. The short sale right now that I have can get me an approval in about 2 weeks and they are the most efficient I have seen. I have a shortsale on the buying side with Bof A and Chase and they might have an approval in 2 weeks more as we have been in the process for about a month now. One agent told me that US bank was taking several months(which I fail to believe really in this HAFA era). The listing agent should know what sort of time line they are on because you do not want to be held up for something that may not fufill. Shortsales have a high failure rate, especially if there are two lenders. The listing agent should update your agent regularly as to progress of the transaction. No communication is a bad sign...I have a client buyer that wanted frequent updates . I called and emailed the listing agent to no avail. She called him on her own as she went to the owner's house, and the listing agent then apolgetically updated me on the progress. Try not to ask for too much. Banks like cash offers especially in these situations because they can reduce their costs of payouts. They sometimes will pay closing costs but not always and they will not pay for a negotiator....that will come from the buyer's agent or the buyer's pocket! Don't think about "repairs" because you will not get any. In short , the less you ask for , the better. Lowball offers do not work. If the listing indicates" approved " shortsale than that is a good sign that that is the minimum price they will accept. Offer that if not more!
If you are the seller...
Please cooperate fully with your agent. They will need lots of financial information that the lenders will need to see to justify the shorting: Paystubs, Bank Statements, Letter of Authorization, and the Hardship letter. Don't be surprised if the lender issues their own paperwork as this will happen about 75% of the time. Make sure your agent expalins the merits of each offer. Reject lowball offers as this will waste everyone's time. If your bank has filed a default notice, or threatened a sale at auction, they only thing that will stop the clock is a bona fide offer near the approved price. The bank will send out an evaluator to verify the validity of the offer. They might initially approve a slightly low offer if it is close to BPO price.Please know too that although you may detest your bank that they may require a note to be signed by you that you will pay them x amount of dollars (Greentree wants 5% of the sales price). This is generally much better than a foreclosure since you can buy again in 3 years vs 7 years if you get a government backed loan (FHA,VA,FNMA,Freddie Mac)
Check with your agent if they use a negotiator in the process ( a lawyer negotiator is the best) as they may be able to help stem the impact. They should never charge you for the services as the fees come from the agents or sometimes the buyers. The agent can go at it himself but it is very time consuming. Be aware of the negotiators with an "investor" They will flip the property and this is generally not ethical. Be aware also that they need a RE license just like your agent.
Make sure that your home is accessible to prospective buyers. It may be an inconvience but you need as much exposure as possible to several eligible buyers and you really do not have time to stall. REMEMBER FORECLOSURE STINGS!
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