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Short Sales take some extra time....so buyers should be prepared to be patient

By Judy Tuscano

Real Estate Agent with Prudential Verani Realty

February 21, 2008 11:08 AM

We have been working with a couple short sales recently and as most of you know they tend to take a bit longer than your conventional sale due to the Third Party Approval.

Well, my hubby and partner, Mike is great at negotiating so he is the one that handles the details of short sales for our seller clients.

We got approval from one the other day which was started in January. It is scheduled to close on February 27th. We were in the office yesterday and we got notified that the buyers had STOPPED PAYMENT on their deposit check!!!!!!

What happened???? They decided that while they were waiting for the process they should take a vacation so they applied for several credit cards so when the bank did their final check on their credit the debt to earnings ratio was not what they expected so they were denied credit!

So now the buyers can't buy and the sellers need a new buyer. I hope we get off this merry-go-round soon.

UPDATE FOLKS - THIS PROPERTY WENT RIGHT BACK ON THE MARKET

AND WE HAD A NEW BUYER WITHIN 2 WEEKS - PROPERTY CLOSED 3/31.

Judy Tuscano, REALTOR, ABR

Prudential Verani Realty, Epping, NH

603-498-2263 cell phone

603-693-0919 office direct

jude1220@yahoo.com

Licensed in NH

Comments(19)

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John Walters

Frank Rubi Real Estate - Slidell, LA

Licensed in Louisiana

You would think the banks would want to get these properties off their books as soon as possible.

Feb 21, 2008 11:15 AM

Frank Rubi

Frank Rubi Real Estate, LLC - Metairie, LA

FrankRubiRealEstate.com

Judy, I will post on my personal short sale tomorrow. After seven months, finally tomorrow morning i hope to close this short sale. I have another I will place an offer tomorrow on with the same seller. Maybe that one will close in June.

Feb 21, 2008 11:15 AM

Dwayne West

Atlanta Real Estate - Canton, GA

Canton Georgia Real Estate

Thanks for the information about these short sales. I think I will be making my first offer on a short sale this weekend. I will explain to my buyers.

Feb 21, 2008 11:27 AM

Tina Merritt

Nest Realty - Blacksburg, VA

Virginia Real Estate

Judy, I have been recommending to my clients that they use a local attorney to negotiate their short sales once we get a contract. The attorney seems to get things moving much more quickly and doesn't seem to get the run around that I sometimes do with the banks. It also helps to use her because then she is also negotiating my commission, which is always better with a 3rd party.

Feb 21, 2008 11:30 AM

Marchel Peterson

Results Realty - Spring, TX

Spring TX Real Estate E-Pro

Judy, I have done a couple of short sales and they should be called long sales. We actually lost our buyer on the last one at the very end after going clear through the process but another buyer showed up and we ended up closing in less than 2 weeks. I hope you have the same results.

Feb 21, 2008 12:03 PM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

John - The bank was not so bad. I think 6 weeks to approve a short sale is pretty good but the buyers wrecking their credit in 6 weeks???

Frank - I have heard of a lot of short sales going that long but this was only 6 weeks.

Dewayne - I hope your buyers are good listeners.

Linda - Good counsel, too bad the cobroke with the buyer paid so much attention to the bank approval instead of her client. Good to hear from you.

Tina - My hubby did a great job negotiating with the bank. Your idea is good if you get the run around. Sometimes I think a man's voice commands more attention.

Marchel - We put the house right back on the market and I hope we can get it sold again quickly before a foreclosure happens.

Feb 21, 2008 01:46 PM

Adam Waldman

Westcott Group Real Estate Company - Hauppauge, NY

Realtor - Long Island

JUDY - I'm working on a similar post for people in my area. Many times I need to educate people about what a short sale is first.

Feb 21, 2008 10:23 PM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

Adam - I couldn't believe the BA did not keep on top of her buyers especially since they are first time homebuyers and obviously unaware of how credit can be affected. Thanks for commenting.

Feb 22, 2008 12:45 AM

Monika McGillicuddy

Berkshire Hathaway HomeServices Verani Realty - Hampstead, NH

Southern NH & the Seacoast Area

Jude..I'd say the buyer agent did a p**s poor job counseling her clients....good grief!!!!

Thanks so much for picking us up at the airport today...it is nice to be home :)

Feb 22, 2008 07:27 AM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

Moni - I wish I could ssay I think differently but with everything happening a week to closing???

We were happy to pick you guys up and now I owe you a couple bowls. lol

Feb 22, 2008 07:54 AM

Monika McGillicuddy

Berkshire Hathaway HomeServices Verani Realty - Hampstead, NH

Southern NH & the Seacoast Area

You can buy the bowls Sunday night. What time are we supposed to go?

Feb 22, 2008 09:53 AM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

Moni - I think it starts at 6pm but am not sure. Maybe we can call Eddie and ask him?

Feb 23, 2008 01:49 PM

Bill Somerset

Re/Max Realty Group - Dover, NH

ABR, e-PRO - Realtor - NH Real Estate Agent

I'm dealing with my first short sale representation currently. I am on the buyers side and have let them know that this is not exactly the easiest process. It will be a learning process for both of us along the way.

Feb 26, 2008 12:58 AM

Derek Bauer's, www.DoorToDreams.com Door to Dreams Home Selling Team

Real Estate One - South Lyon, MI

They sure do try your patience ... submitted an offer in mid-September on one, and it closes this Friday. Handful of others in the works ... it's the new norm!

Feb 26, 2008 12:59 AM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

Bill - Be sure to keep close communication with your buyers during the process so they don't get discouraged.

Derek - That is a long time. My hubby seems to have a knack for getting the right contact at the bank quickly so he is getting answers sooner making the process a bit shorter. Congrats on the closing.

Feb 27, 2008 01:09 AM

Todd Clark - Retired

eXp Realty LLC - Tigard, OR

Principle Broker Oregon

Stopped payment? What is wrong with these people! Sometime I wish people could just be honest with themselves and if you can't afford to do something then wait! In this case they affected someone else's life and that is just wrong!

Mar 14, 2008 05:42 PM

Judy Tuscano

Prudential Verani Realty - Nottingham, NH

NH Real Estate Professional

Todd - It was a hard pill to swallow but in the long run worked out for the best. We got another offer with less contingencies, certified funds for deposit and it closes next week. It could have turned into a law suit for the deposit but is that really the goal? I'm thinking that certified funds will be the new norm for short sales deposits. I can't believe that the banks will stop payment on checks after they are deposited to another account.

Mar 15, 2008 12:38 AM

Katherine Anderson

Coldwell Banker Hobin Realty, LLC - Hampton & Rye, NH, USA - Exeter, NH

Managing Broker

Wow... that sure stinks. I guess this is just another reminder that not all buyers are really that savvy. We should remind them up front that they cannot do such things. I am amazed at times with how a seemingly intellligent consumer can make such obviously stupid choices. Sorry to hear about the wasted time. I would also be checking with the legal hotline with regard to that deposit money. If you were supposed to close back in February, I'm assuming that your loan commitment date is past as well. The buyer's deposit could be in jeopardy. If you don't actually have the funds, I would be concerned with what the banks recourse might be. I'm sure that they are not thrilled with the lost time either and may be consulting their attorneys. Good luck.

Mar 15, 2008 12:51 AM

Katherine Anderson

Coldwell Banker Hobin Realty, LLC - Hampton & Rye, NH, USA - Exeter, NH

Managing Broker

oops, I just realized that this was an old blog. By the way... what happened with the fact that the deposit check couldn't clear the bank?

Mar 15, 2008 12:56 AM