Archive for category Short Selling Investment Property
Posted by BoiseShortSale in Alternatives to Foreclosure, Boise Property Management, boise short sale, boise short sale expert, Can I make Money on a short sale?, CDPE, Cooperative Short Sale, Deed in Lieu of Foreclosure, FTC MARS, HAFA, How Can I Avoid Foreclosure, Idaho Loan Modifications, idaho short sale, real estate, Short Sale Approval Letter, Short Sale Failure, short sales, Short Selling Investment Property on April 11, 2012
Short Sale Fail – A Series on Questionable Things I Run Into With Short Sales: Intro
I daily run into behaviors, responses from “experts”, forms required by “experts”, etc. – things that make me scratch my head when I am working with short sales. Not always are these things that I run into worthy of an entire blog post but I figured I would create a series to at least allow for brief posts discussing/presenting these things.
This is a series that I will revisit as time permits that is good information for both Buyers and Sellers in considering the short sale process. Short Sale Fail obviously suggests that I will at the very least bring into question some of the practices, forms, designations, etc. discussed.
Please touch base if you are considering buying or selling as a short sale. 208.830.6185
*This is not to be construed as legal or financial advice and you should seek qualified council regarding any financial or legal questions.
Posted by BoiseShortSale in Alternatives to Foreclosure, Boise Investment Property, boise short sale, boise short sale expert, How Can I Avoid Foreclosure, Idaho Loan Modifications, idaho short sale, real estate, Short Sale Approval Letter, short sales, Short Selling Investment Property on September 23, 2011
As I reflect back on a week that we have closed a couple more properties and helped a few more home owners avoid foreclosure I continue thinking about a number of discussions with another listing agent and a short sale seller that are not working with me but have kept in contact with me for a few months with occasional short sale related questions, etc. The recent conversations included questions along the lines of “What would you do if this happened?” “Have you ever seen this happen?” “How do I fix this?” – in general what do I do about this short sale that has turned into a train wreck?” In discussions it became apparent that either the Seller was not provided the Short Sale Approval Letter prior to closing or they did not read through it until the day of closing. In each situation it nearly blew the short sale up which likely would have landed the properties in foreclosure.
The letters in question included terms allowing the lender to seek a deficiency judgment (which is a pretty big deal). Trying to sort things out to determine where the train jumped the tracks wasn’t something that could be determined but I did emphasize to the agent that should they do another short sale in the future it is probably a good idea to read through the letter to know what it is saying and to also provide the approval letter to the client well in advance of putting all parties in motion to closing and give the Seller the opportunity to review and approve of the terms of the letter.
In working with our Short Sale Sellers we provide to them a copy of the approval letter prior to releasing it to the buyers agent. Our Seller’s have the opportunity to review the letters and seek legal and/or financial advice (neither which we can provide) should that be important to them prior to approving of the short sale approval letter. If all looks good to our Sellers we have them sign the approval letter itself and a few documents as well that instruct us to put all parties in motion to closing – again – before releasing the approval letter to the buyer agent.
As a short sale seller client of ours you can be assured that you will have the opportunity to review your short sale approval letter(s) as we receive them so that you are on board with the terms. Our goal is to make the process as transparent as we possibly can while helping your reach the most beneficial outcome. We’re not into train wrecks…
We received a nice note of thank this past week from a client that we helped short sell a house, get the bank to release deficiency rights, and avoid foreclosure in July that I thought I would share with you. My goal is to help every one of my clients have such a positive outcome and avoid a train wreck that short sales can become with the wrong agent at the wheel.
I don’t think I every thanked you for doing such a great job with the Short Sale of my property. The entire process was smooth, painless and most of all transparent. I wish to tell all potential clients that I would most certainly do business again with you if the opportunity presented itself.
San Francisco, California
Below is a video created by and featuring Lee Honish, former Head Loss Mitigatior for IndyMac, now OneWest Bank on the reality of trial loan modifications. This is the scoop on loan modifications. Weekly I work with clients who attempted a loan modification but mysteriously after the trial period ended were denied the loan modification and helped down the road to foreclosure by the very bank that said they were “helping” them.
Are you facing foreclosure? Lets talk soon…
Some buyers touched base with my wife and me over the weekend to take a look at a $600k short sale property. We lined up a time to take a look but before heading out to show the house I dropped the listing agent a line.
The short sale was being marketed as an “Approved Short Sale” so I wanted to make sure what the listing agent meant as the answers you get to that question really vary. Just a pet peeve it should have been listed as a “Previously Approved Short Sale” but I digress. I asked the obligatory questions of who’s the bank, what do you mean by approved, is the file still open and active with the negotiator at the bank, etc. I “foolishly” asked if any buyer closing costs had been approved…the listing agent went into a big rant about Bank of America not EVER agreeing to pay any buyer closing costs. I tried to tactfully convey that they do but quickly realized I was dealing with an “Expert” who wouldn’t accept any questioning of her authority on the short sale process, BofA short sales, and on who came first – the chicken or the egg. I tried to chalk it up as someone having a bad day, on an ego trip, etc. but then confirmed my suspicion that this expert hadn’t closed too many short sales and surely not too many with BofA. 9 … 9 short sales total closed and she was the authority on BofA short sales?
I bit my tongue and headed out to show the house.
I arrive at the house and who is at the house – none other than the “Expert” listing agent (this is not customary in ID for the listing agent to be at the house during a showing). Turns out she was waiting for the water company to turn on service to the house. It was a 6,000+ sqft house on a fair size lot so we spent an hour or so checking out the property with Ms. “Expert” Agent hovering, trying to interject in conversations, and watching us through the windows as we walked the grounds. As we were wrapping up the showing Agent “Expert” was hanging around the door and quickly stated that the house was approved for “x” and that to write an offer for anything less than that would be a waste of time. Wonder if her Seller would like to hear of that? She then went on bad mouthing her seller clients and also another agent that had presented an offer lower than the previously approved offer. Classy. Then as the buyers went back through the house to check out a couple more things I stood there talking with the “Expert”. She told me short sales were all she did and insinuated she had a sizable number of short sales currently listed (4 times the actual number she has listed). She then told me all about her expertise and reiterated that short sales are all she does and that oh by the way she teaches short sale classes. yeeesh…..
After she finally left the property my clients chuckled at how big a head the agent had and I gave them the low down on her actual numbers and explained the reasons that she may have said some of the things she had, etc. Needless to say my buyers were not impressed with this agent, we both knew she was full of it and herself.
As I drove away I wondered how someone gets paired up with an agent that discourages offers, bags on her clients, etc. I felt sorry for her clients and then later in my drive I felt sorry for for Ms. “Expert” as it seems a rough existence to be so full or yourself and/or delusional to twist closing 9 of 42 short sales into a performance that qualifies her as an “expert” all the while helping clients down the road to foreclosure.
Don’t be fooled when looking for an agent to help you short sell. Coming through 22% of the time won’t keep you swinging a bat in the big leagues even if you look and sound the part. If foreclosure is what you are trying to avoid you want an agent that bats far better than .220 – give me a ring.
Lately most of the folks that are selling are upside down in their properties and need to do a short sale. Many of these sellers purchased rental properties and have landed themselves with a property worth 50% of its value during the boom. Times are tough and whatever the hardship maybe they need to cut loose of these rental properties that are dragging them down and avoid a foreclosure.
As we work with owners of rental property we also involve their property management company in gaining access and cooperation of the tenants to get the house sold and avoid foreclosure. The way that a lease agreement and management agreement are structured initially are very important items for a seller to consider looking to the future when they intend to sell the property.
Recently we are finding that a few property management companies have created leases that do not allow a property to be shown as is generally customary with 24-48 hours notice given to the tenants. Most recently one of the management companies that drew up a lease like this had no real explanation for why the lease was drawn up this way but they were adamant that even though the property owner is just a few months away from a foreclosure auction there is nothing that could be done to change the inability to have the house shown. The central flavor of the conversation being bitter because the management company was losing a property that they manage (monthly income).
As this whole conversation is taking place I am thinking in the back of my mind how much differently the person on the other end of the line at the management company would be feeling if they were in their clients shoes – staring down the barrel of a foreclosure.
In light of running into this situation a bit more as of late if you are talking to a management company to handle your investment properties and draw up the leases for you one important question to ask of the management company might be “Explain to me the process when I am ready to sell the house whether a tenant is in the house at the time or not.”
Make sure you are not painting yourself into a corner.
Hopefully when you sell you are in a positive equity situation on the property and not staring down a foreclosure with a management/lease agreement that has your hands tied keeping you from being able to actively market and sell your property.