Here is an excellent blog about the importance of a buyer's agent interviewing a short sale agent before proceeding with an offer on one of their short sale listings. The short sale agent is completely in control and must be competent and efficient in processing the short sale process.
Short sales aren't going away anytime soon. They are a market reality. If you want to sell homes, you'll eventually have to deal with them, if you haven't already. Personally, I'd rather list a short sale than bring a buyer to one. As a Buyer's Agent, I am impotent in doing anything to move the transaction toward bank approval.
When I do encounter a short sale listing that a buyer is interested in, I first make sure that my buyer can handle delays. I have to ensure they have a place to stay indefinitely. That being the case, I move on to interviewing the Listing Agent. They are the ones holding all the power. I want to be sure that they know what they are doing, and are motivated to do it.
I make sure that there are no offers on the home. I also make sure that if my clients write an offer, that the Listing Agent is not going to continue taking offers and submitting them to the bank. What a waste of time! The bank didn't sign their listing agreement. This is not an REO. Furthermore, our MLS is very explicit about when a Short Sale Listing is considered Under Contract. No surprise to anyone who knows what they are doing, it is when the buyers and sellers have signed the contract, and it has been submitted to the bank for the approval contingency. Of course, if I'm dealing with a Listing Agent who knows this, and choses to not have the sellers sign the offer, I know to move on. I have a game player on my hands. My clients are BUYERS, not game players. If they are commiting the property, then we expect the same commitment to our contract.
I also make sure that the Listing Agent has set the stage for a smooth approval process. If they haven't submitted the Listing Agreement, Hardship Letter, Letter of Authorization, and whatever required Financials to the bank before now, this is just going to eat up valuable time. I am looking for a Listing Agent that has submitted all of this and is simply waiting on a Contract and a Preliminary HUD. If I am talking to a Listing Agent who has no idea why a Preliminary HUD is necessary, or what the bank's process is, then I know we are in trouble.
Finally, I am looking for guidance from this Listing Agent as to how long a time frame is reasonable for bank approval. I'm not looking for them to blow sunshine up my rear. I'd rather know I'm dealing with someone in reality, than not.
Once I have answers to all of my questions, I inform the buyers and allow them to make their decision as to whether they even want to see the home. My clients have each been very well educated as to the pitfalls I'm uncovering by interviewing these Listing Agents. My clients always make educated decisions based on this pre-interview. And they know the extent of what I can do, is this interview and advising them on writing a solid offer.
Chris Ann Cleland, Realtor- Licensed in Virginia, GRI, SFR, Northern Virginia Short Sale Specialist. Affiliated with Long & Foster, 7526 Limestone Drive, Gainesville, VA 20155. To contact Chris Ann, call 703-402-0037 or email chrisann@LNF.com. Or you can visit her website: www.nvarealestate.net.
Header photo is Lake Manassas in Gainesville, VA taken by Chris Ann Cleland.