Short sales, or trying to convince the lender to accept less than is
owed on a property can be a wonderful thing for both buyers and
sellers. By working with the bank, the seller can get out of an onerous
burden and move on with his life. The buyer can acquire a property for
a realistic, market-based price.
But for the realtor, meaning me, it can be a frustrating,
time-consuming, and an all too often pointless pursuit. I have spent
months (!) cultivating a buyer, showing them every house east of the
Mississippi River, only then to have them choose a property "subject to
bank approval for a short sale" is disappointing.
The problem I've encountered is it takes soooo long to get a response from the bank. Are banks not interested in accepting less? Would they rather the property go into foreclosure? That is so short-sighted! I don't feel sorry for the banks: they lent the money based on a wishful appraisal, done only to justify the loan request. When the market corrects itself, as we are now seeing, the bank gets what it deserves.
In the meantime, my buyers are losing interest, I look like an idiot for not being able to get an answer from the listing agent, and everyone ends up getting frustrated.
I think the reason it takes so long for the bank to respond is listing agents, KNOWING they are going to have to negotiate with the bank, don't fully prepare their sellers. Banks won't even consider a short sale unless they have documentation supporting the request to accept less than is owed. Meaning: every scrap of paper the seller owns: paycheck stubs, proof of income, household budget including all income and expenses, a letter explaining why they need to sell the house and why they can't get what is owed, a letter authorizing their realtor to speak to the bank, everyone's social security number, etc. Listing agents must prepare their seller to provide this information to the lender BEFORE putting the house on the market. The Realtor must communicate with the lender to see if the client even qualifies for a short sale. Sometimes they are not eligible!
Please, my fellow realtors, do your homework BEFORE you offer a property subject to short sale.
The problem I've encountered is it takes soooo long to get a response from the bank. Are banks not interested in accepting less? Would they rather the property go into foreclosure? That is so short-sighted! I don't feel sorry for the banks: they lent the money based on a wishful appraisal, done only to justify the loan request. When the market corrects itself, as we are now seeing, the bank gets what it deserves.
In the meantime, my buyers are losing interest, I look like an idiot for not being able to get an answer from the listing agent, and everyone ends up getting frustrated.
I think the reason it takes so long for the bank to respond is listing agents, KNOWING they are going to have to negotiate with the bank, don't fully prepare their sellers. Banks won't even consider a short sale unless they have documentation supporting the request to accept less than is owed. Meaning: every scrap of paper the seller owns: paycheck stubs, proof of income, household budget including all income and expenses, a letter explaining why they need to sell the house and why they can't get what is owed, a letter authorizing their realtor to speak to the bank, everyone's social security number, etc. Listing agents must prepare their seller to provide this information to the lender BEFORE putting the house on the market. The Realtor must communicate with the lender to see if the client even qualifies for a short sale. Sometimes they are not eligible!
Please, my fellow realtors, do your homework BEFORE you offer a property subject to short sale.
