by Shawn Robert, Transaction Manager, http://www.reliablepropertysolutions.com/
We sometimes hear Realtors say that short sales aren’t worth it and rarely work out. That is not our overall experience and we have several practices in place to ensure success.
First and most important is to prescreen the Homeowner before taking the listing. This means collecting and reviewing all of the financials (including Hardship Letter) so there are no surprises (like 20K sitting in the bank). This also includes going over ramifications of short sale with the Homeowner (i.e. possibility of a 1099, a soft note on the 2nd and that any liens on the property will need to be paid). For example, if a Homeowner has a home equity line of credit the bank will most definitely ask them for a soft note to proceed with a short sale. If the Homeowner absolutely refuses to comply with such condition it is best to know upfront rather then after many months of hard work obtaining an approval.
Second, following up and educating the Buyer’s Agent throughout the process is very important. This practice will keep the Buyer’s Agent calm which in turn creates a trickle down affect to their client. We have had many Buyer’s Agents tell us that our involvement lead to the first short sale that ever worked out for them. Most of these Buyer’s Agents ultimately became clients when they listed their own short sales.
Third, consistently following up and pushing the bank(s) is important in facilitating whatever the bank(s) need as quickly as possible. We all know the banks move slow but when we find out that a package has disappeared after a month it is key to move quickly and supply whatever they need. Consistent follow up is also important when it comes to escalating a file when things are not moving forward in the time indicated by the bank(s).
Utilizing these practices will guarantee a much higher success rate with short sales. We can attest to that!
One thing to keep in mind throughout this year is that the Mortgage Tax Relief Act which exempts primary residents from receiving a 1099 resulting from short sale does expire on 1/01/10. It would be nice to see this extended but there is no guarantee.
I wish everyone a Happy and Prosperous New Year.
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