MOST COMMON MISTAKES (preventable issues)
Priced incorrectly:
Most agents price Short Sales like a traditional sale. We don't have 6 to 9 months to sit on a property and hope it sells. The expectation needs to be set up front with the client that they will not be getting any compensation from the sale of their home and Short sales must be priced competitively.
Incomplete short sale package:
This can make or break your deal. Keep in mind that there are hundreds of packages being submitted. If yours is not put together correctly, you run the risk of it either being shredded or it being put underneath all of the other hundreds of packages.
Lack of tenacity (follow up):
If you are not following up with everyone involved as your short sale goes through each stage in this process you may not know that your file has been delayed and you run the risk of running out of time or lose your buyer.
Not enough time:
It is important to know the laws and timelines of the foreclosure process in your area. Communicating with the mortgage companies is crucial. You will need to find out exactly what stage the home is in. Many mortgage companies will stall a foreclosure if they think a sale is in the works. It is also important to allow enough time in the contract when an offer comes in. Short Sales need a minimum of 60 day closings.
Not submitted properly:
Fax and send a copy in the mail. Call within 24 hours to make sure package was received.
Offer is to low:
(See pricing strategy) Putting in a low offer is not always a bad thing. This gives you an opportunity to see what the lender will do, and what their threshold is.
Buyer Financing:
Pay attention to the offers that come in. If you receive a contract for 100 % financing for a first time home buyer you might want to call the agent and see how they intend to do that in today's market. The contract needs to be strong enough to close.
Cash offer without proof of funds:
Some agents will have their clients to make a cash offer to make them look stronger when in reality they will be financing. Always ask for proof of funds.
Title search not completed:
Many times an agent forgets to do a preliminary title search on the property and at the last minute they learn of other liens on the property. This will not allow the deal to close.
Funds not in escrow:
Make sure buyers deposit is in escrow. You do not want to run the risk of the lender calling your title and escrow company to verify that the funds are there. This will cause them to put your file aside.
ISSUES OUT OF YOUR CONTROL:
Loan gets sold:
Loans can be sold from one company to the next. If this happens while in the middle of negotiations you would need to contact the new mortgage company and submit a new package.
Loan is reassigned:
Sometimes lender representatives leave the company and get reassigned and this could happen in the middle of negotiations. You will need to find out who the new representative is and send over a new package.
Does not meet criteria:
If the lender gives you their bottom line you will need to find a contract the fits their criteria or the foreclosure process will not be stopped.
Lender changes strategy:
If a lender decides to bulk sale their loans, there is no remedy for this. They will stop negotiating the short sale at that point. The stronger your proposal, the better chance you have of not getting your loan sold.
I specialize in short sale negotiations. I am happy to take on that responsibility for you. I can help you pre qualify your clients, (They are your clients, not mine) I will do all back office and negotiations, I will coach you along through the whole process. I do the work and you get your full commission. I can give you the expertise necessary to help you help your clients, help our market and earn your commission you may have otherwise walked away from, without having to do all the work.
Call today to find out how our program can help you....