Short Sales of Convenience?
As a listing agent, I always delve down into the story of why my clients need to short sell their home - as a Buyers Agent, I always call their lender to check on the status of their pre-approval. These precautions ahead of time solidify that there will be a sale, for either the seller or buyer. Lenders are getting a lot more cautious and having to be pre-approved by mulitple lenders isn't a bad idea in todays market. If you have something to hide, either be upfront in the beginning or realize that it will probably come out somewhere, sooner rather than later.
I'm starting to see a new trend in short sales in our area. I recently had a client who wanted to buy a property. I met with him and his wife, and I had them get
pre-qualified with their lender and they qualified for a nice property. Off we went in our search, and after a couple weeks we found a great house.
The only issue with this house was that it was an REO and required a certain lender do the pre-qual before the seller would consider a contract. So, I sent my buyers off to a friend who worked for that lender with the expectation that they would be back shortly with another pre-qualification letter. It would be easy since they had
already been pre-qualified, right? That's what I thought, anyway.
After the interview, the lender called and asked how much my clients had shared with me about their financial history. They had only discussed what their bank said in their original pre-qual letter. The lender couldn't share their personal information because of confidentiality, but with their approval, she told me that they had a short sale last year.
In the days that followed, I confirmed that my buyers had done a short sale the year
before. When asked what led to the short sale they explained that they didn't like their neighborhood or the trend it was following. So, they decided to move out of it so their children wouldn't grow up there.
Wow! That was information that needed to be shared up front in the beginning of our interview process. Later, I emailed them to get the name and number of the lender that had pre-qualified them prior to our visit with the second lender. I'm still waiting. That experience has made me a little more cautious about taking someone at his/her word. I know it's necessary to trust, but I believe I will need to start a "trust, but verify" policy with new clients.
"Short sales for convenience" are going to catch a lot of people off guard when they start their next property search. People who are contemplating a short sale
should be advised that short sales are not a "get out of jail free" card. When a seller is trying to balance the options and a short sale is considered we need to be completely honest with them if it's not a true hardship situation.
Choices have consequences. A short sale may be the only route some sellers can take, but it should never be used to blow off a mortgage commitment that is not a hardship situation. IMHO.
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Give me a call for all your real estate needs, and let's make something amazing happen.
Mike Cooper @ Cornerstone Business Group, Inc., 888-722-6029
Real Estate Sales and Property Management
(Disclaimer: All grammatical mistakes, punctuation breakdowns and misspellings are purely for your amusement and entertainment. Feel free to cackle.)
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