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Did you REALLY offer your seller ALL of his options?

By
Services for Real Estate Pros with Greene Notes, LLC

After a seller reduces the price of her home to a place where she will be taking a big loss, after she has spent yet more money updating, replacing and dressing up her home trying to sell, what would you tell her?

Let's say, even worse, that this is your sister and her husband who lost his job.  They have kids and he's been unemployed over a year.  The only thing they have left is the house which he always made double payments on and paid off.  But, after a year of unemployment, everything else is spent and they have to sell - they are even considering selling to one of those companies that prey on people who are hurting and pay them $0.20 on the dollar for their homes.

You are a professional real estate agent, how will you help?  Let's assume some numbers and facts here: 

1.  Original purchase price = $300,000

2.  Lived in home 10 years

3.  Home values in area have gone as high as $375,000 in that time frame.

5.  Home values have taken a big slide, the company who laid off the husband is moving out of the area and they were the single biggest employer within ten miles.  Hundreds of other people lost jobs as well.

6.  Current appraised value = $224,900 (and possibly dropping)

7.  20 cents on the dollar = HUGE LOSS!

Comments(6)

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Angelia Garcia
Pure Realtors - Dallas, TX

Wow, that is harsh. In this market, you are doing everything you can do. It's good that they don't owe anything on it. The way I see, if they get a buyer for it, they need to take it. I would advise them not to sell to those sort of companies.

Aug 19, 2008 11:44 AM
Eric Reid
Renaissance Realty Group of Keller Williams Atlanta Partners - Lawrenceville, GA

ok they owe nothing so why the need to sell ? have they looked at a reverse mortgage to provide cash and draw against the remaining equity ?

Or maybe sell and interest in the home to and investor that at a future date when the market is high and they sell gets a share of the interest of the profit / equity growth.

Aug 19, 2008 11:51 AM
Anne Hensel
South Beaches Real Estate Professionals - Saint Petersburg, FL
Realtor - Broker - St. Pete Beach, Treasure Island

Sell and go to a place where you can find a new job. sometimes you have to loose money to make money. It is a tough decision but I see no other way.

Anne

Aug 19, 2008 12:02 PM
Shan Greene
Greene Notes, LLC - Hartland, MI

But everyone, there is no market for real estate in this scenario.  What is the market price for a $300,000 home in a town built around one major industry which is moving out, in an area that is flooded with other homes on the market now because of laid off workers leaving the area? None.  Twenty cents on the dollar is sounding better, huh....

No one goes into the investment in a home with the foresight to know that it will fail.  Guaranteed to fail!  Would you buy this home?  How can you know when to expect a return on this investment?  This exact thing has happened repeatedly throughout America's history, and frequently the local economy NEVER bounces back.

 He's been unemployed for over a year so there are very few financial options which might include lending.  But, he knows the area and he's trying to make it there.  ERIC!  Right on the money!  Go to an investor sell a 1st lein note to him for the home for $60,000 dollars paid over ten years at 10%.  Sure! everyone knows an investor who will just hand over $60,000, you say?  I do.  My name is Shan Greene and I am the owner of Greene Notes, LLC and we help you sell your private mortgage notes to investors.

Please read my other blog postings and feel free to comment.

www.GreeneNotesLLC.net

Aug 19, 2008 01:02 PM
Eric Reid
Renaissance Realty Group of Keller Williams Atlanta Partners - Lawrenceville, GA

So SHAN what is my prize for think out side the "must sell box" .... ??

and dont tell me 25 active rain points.

Aug 22, 2008 08:34 AM
Shan Greene
Greene Notes, LLC - Hartland, MI

Alright.  Hmmmm.

How about an opportunity to develop a mutually beneficial professional relationship?

 

www.GreeneNotesLLC.net

Aug 22, 2008 11:14 AM