I have had some recent experiences that have inspired me to write a blog about, "The truth about short sales". This is NOT a class, and I am a licensed Realtor, but NOT a Short Sale Certified Specialist. This is basically an ABC's for Buyers and Sellers. This is also based on MY experience and professional opinion. I will cover Sellers first, because then Buyers will understand the process a little better.
What is a Short Sale? Basic definition is a Short Sale is when a home is being sold "short" of the liens and mortgages that is owed on it.
SELLERS: When entertaining the idea of selling your home as a Short Sale, Pahleeeeze...speak with a few Realtors (preferrably a Realtor that is a Certified Short Sale Specialist). Make sure they KNOW what they are talking about. Some clues...If they make sense to you, that means through the process, communication will be good. That is SUPER important! A Realtor that knows Short Sales, will also more than likely advise you to also speak with your CPA and or Attorney (to make sure this is the right decision for you). A Short Sale does not necessarily ruin your credit. It actually depends on each situation. A Certified Short Sale Specialist can give you a really good idea of all of your options. If a Realtor uses a "Mitigation Company" be hesitant (MY OPINION ONLY!). Here's why...a knowledgable Realtor and Title company, can handle a Short Sale on their own. A Mitigation company charges a fee, which will NOT be paid by you (the Seller), or the BANK. Therefor it must be paid either by the Realtors or the buyer. This makes your property a bit less appetizing. I personally will list a Short Sale, but will partner with an Agent that is a Cert. Short Sale Specialist.
BUYERS: The MOST important thing for you to know about Short Sales..."PATIENCE IS A VIRTUE". If you are in a rush to buy a home, a Short Sale is NOT for you. There are so many hoops for the Listing Agent to go through, it is a time consuming process. The second most important...A Short Sale in no way means...Garage Sale. A Realtor that knows what they're doing, has priced the property to reflect closely what the Bank SHOULD approve. When making an offer, my opinion is to stay close to the asking price. The alternative is to make a low ball offer, wait a potential 4 months to get a "No". You have then wasted 4 months of your life, that you can no longer get back. If you are ready to make a commitment to a home, and "feel that great love", then the process is worth the wait. Lastly...be aware that you MAY be asked to pay a "mitigation fee" at closing. Make sure your Realtor makes you aware of that early on.
Well...that's the "quick and dirty" of it. I may come back to add to this. I hope it somewhat helped or clarified some things.
Maureen Velilla
Realtor
727-710-4120
Century 21 East Lake Realty
www.NotJustAnAgent.com
MaureenVelilla@aol.com
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Hey Maureen! Great overview of the short sale process. So many folks out there are in need of this sort of information, especially as more and more homes here in the Central Florida area are moving off the books via the short sale process!
ReplyDeleteQuestion - are you noticing any sort of trent or developing " in most cases " sort of scenario in terms of folks being left to pay deficiency judgments after selling their homes via a short sale?
Actually...I am seeing a trend where the other leins refuse to "let go" or negotiate down. I am also seeing more banks opting for foreclosure, even with good offers on the table, instead of accepting them. A few happened last week. Not sure if they were isolated incidents. I think due to the 1st scenario...more short sale sellers might end up being responsible for their deficiency judgements. I can see it leaning that way.
ReplyDeleteThanks sooooo much for the comment!