Short-Sales are something that every real estate agent and consumer should be familiar with. Unfortunately for many people, in today's market there are more short-sales than ever. There are several things that people who work with these kinds of properties need to be familiar with. We'll cover what a Short-Sale is and how it might affect the homeowner
Once the homeowner has exhausted the other options, and decides a short-sale may be the best option, it's time for a Realtor to get involved. At this stage, a good agent will take an active role in working with the lender as well as the homeowner. The agent lists the home, making sure to follow these rules:
- If the home is a Short Sale, it MUST be identified as such in the listing.
- If the lender has already approved the sale price the home is listed for, then the listing should be classified in the MLS as "Short Sale, price previously approved." If the listing price has NOT been pre-approved by the lender, the property should be listed as "Short Sale, price subject to 3rd party approval."
When the listing is complete, the homeowner will need to authorize the agent to speak to the lender on their behalf. The agent needs to know exactly what the lender requires, and help the homeowner get this in place. The worst thing to happen is to get a solid offer on a home and then find out the lender won't negotiate or talk with your Realtor. From this point on, the real estate agent should coordinate with the lender with respect to the real estate transaction. However, the agent should NOT attempt to provide tax, accounting or other advice to the homeowner.
Once the listing is placed, potential buyers will begin finding the home. It is important for the agent to continue to represent the home fairly for the homeowner. In almost all cases, the short-sale will appear on the homeowner's credit report, so it is important to get a fair purchase price to lessen the impact as much as possible. However, it is also important to sell the home as quickly as possible, so trust your Realtor to help you evaluate offers and strike a good balance, but don't go to the bank with an unfairly low offer. If the purchase price is too low, the lender is unlikely to approve the sale, which results in frustration and wasted time for all parties involved.
