Short Sales: A neccesary evil, sellers guide to success.
Short Sales, The Art of Selling
October 23rd, 2009
Whether you call it a pre-foreclosure sale or a short sale it’s pretty hard for sellers to get excited about the prospect of walking away from their investment with no equity and damaged credit. While it may be a hard pill to swallow it is still often the best option to start the recovery process.
If you find yourself in this situation its a good idea to get advice from multiple professionals including your CPA, Real Estate Attorney and perhaps the single most important decision for those who decide to sell their home via short sale, a knowledgeable Real Estate Agent to manage the process. Your Agent will be the person advising you on proper pricing and marketing strategy, negotiating with buyers agents and handling short sale lender negotiations. It’s a complicated process and much diferrant than a typical sale. Select the wrong Agent and your odds of success can be slim to none.
The short sale listing, marketing and escrow process is a specialty that requires a specific skill set, process knowledge and methodology. Not handled properly the opportunity for a successful short sale is greatly diminished and with the bank looming there may not be time for a second chance.
Just as you would not ask your family doctor to perform open heart surgery you should not assume that every Agent is capable of assisting you with a short sale. The fact is that very few Agents have the ability to achive positive results in this highly specialized field.
Using our proven system we have a track record of success in assisting sellers who find it neccesary to sell under these circumstances. Here are a few tips for a successful short sale.
In order to be prepared for a successful short sale it is important that you complete your short sale package prior to putting your home on the market. Hardship letter, financial statement, tax returns and pay stubs are a few of the items required (See SHORT SALE CHECKLIST). These items need to be sent to the lender along with any accepted offer. An incomplete submission to the short sale lender is a recipe for failure. Your Agent should be able to assist with obtaining the necessary forms.
Your initial listing price needs to be based on closed sales of similar homes in the area combined with active competitive listings. Your agent should be proficient in completing a BPO that supports initial listing price.
In order to be successful your listing contract should include a price reduction schedule that results in the highest best offer in a reasonably short time frame. Listing history and pricing is one of the considerations that many short sale lenders review as part of the approval process.
It is extremely important that your agent takes the time to review any purchase offer and negotiate terms with selling agent and buyers prior to acceptance. Contract and HUD should include terms and language most likely to be found acceptable by short sale lender.
As review process by short sale lenders can take from several weeks to months it is very important that buyers have been counselled on the process and have expressed a willingness to be patient and a commitment to the purchase. Buyers who are offering on multiple properties should be avoided if at all possible.
These are just a few basic tips specific to short sales. Please feel free to contact us to discuss your situation in more detail.
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