Tips To Successful Short Sales Presented By: Carol
Tips To Successful Short Sales Presented By: Carol Moson CRS, ABR, e-Pro, SFR, SRS, GREEN, BPOR Main Objectives Smoother and faster short sale transactions that will close Preparing (you, buyer and/or seller) Initiating and working with the banks
Pricing the listing 5. Constructing the offer 6. Working with the co-op agent 7. Working with the bank/lender contact 8. HUD-1 and Approval letter THE MANY FACES
OF SHORT SALE AGENTS 02/21/2020 www.realtor.org/resort 4 5
Dont look for consistency. Look at each short sale as a new endeavor 02/21/2020 www.realtor.org/resort 6 Why Short Sales Fail
According to the negotiators #1 reason is incomplete or not timely delivery of information 02/21/2020 www.realtor.org/resort 7 Patience
Patience Patience Key Words Seriously 1. Preparation 2. Organization 3. Timeliness 4. Schmooze dont shoot the messenger
Some of the following may seem like what you already know but we will be talking about how they can each have an impact on the success or failure of a short sale PREPARATION 02/21/2020 www.realtor.org/resort
11 Preparation No two short sales are the same Plan to be persistent whether you have a phone contact or through Equator always provide info MUST be timely Communicate with the co-op agent
Preparation Be clear on what a complete file is If you dont know what to do get someone to help you that does! Nothing will hold up a short sale more than not understanding what the bank needs/wants Preparation Be sure seller knows UP FRONT what will be expected of them.
Documents: Hardship Bank/Savings statements Paychecks Tax Returns Investor/bank required docs Homeowner should be aware that they could be asked to bring money to the table to close. Depends on their circumstances and financial ablility
02/21/2020 www.realtor.org/resort 15 The Hardship Letter 02/21/2020
www.realtor.org/resort 16 To Whom It May Concern This is a difficult letter for us to write as we have always been able to meet our financial obligations but we are now having difficulties meeting financial obligations. We have had a change in our financial situation which has caused our ability to pay bills to change. (where the reason for the hardship goes) At this time a loan modification is not an option as I have already been denied a loan modification. this
is where you would place job, divorce, etc, information that created the hardship From this point forward we would like to do a short sale of our property located at: 123 Main Street, Anywhere, USA We have _#__ of loans with you. The first loan number is 1234566787 and we believe the balance is approximately xxxxxxxx and the second loan number is 34567888. for which we believe the balance is approximately xxxxxxxx. If no second lien then just do not address that. We understand we need to have a contract for a final approval of the short sale, however we have listed with Sally Sells at We Sell Homes Realty and would like to submit the third party authorization to you for so it is in place when we receive a contract to do the short sale. At this point we have exhausted all of our options and if we cannot do the short sale we are afraid
foreclosure would be the only option left for us. We would prefer not to have a foreclosure as this will only further damage our credit. We respectfully ask that you approve the short sale once the contract has been submitted Sincerely xxxxxxxxxx 02/21/2020 www.realtor.org/resort 17 xxxxxxxxxxxx
Your sense of urgency cannot be greater than the sellers sense of urgency 02/21/2020 www.realtor.org/resort 18 Regulations Fed, Lender and Investor
Resources: Realtor.org Lender websites Fannie/Freddie Preparation Create a file where you can make notations of every conversation with everyone Be sure the seller keeps and opens ALL mail from the lender.
Initiating The Short Sale And Pricing 02/21/2020 www.realtor.org/resort 21 Initiating/Pricing Third party approval
Seller calls lender You call lender/website or D All of the above 02/21/2020 www.realtor.org/resort 22 Initiating/Pricing
Price at low end of market value Keep current comps Many are being pre-approved with minimum net to investor instead of actual list price. There are circumstances where the seller may not need all the financials for a short sale 23 If a value is assigned and you, as the listing agent feel the price is too high, you can
contest it You should also ask for price guidance 02/21/2020 www.realtor.org/resort 24 02/21/2020
www.realtor.org/resort 25 The Offer 02/21/2020 www.realtor.org/resort 26
Offer What to look for Of course price Requested seller contribution to closing Due Diligence or Right of Refusal timeline Closing date Stipulations 02/21/2020
www.realtor.org/resort 27 Offer As the listing agent you need to calculate how the numbers will play out to the net As the buyers agent you will want to
know if the bank has established a minimum net 02/21/2020 www.realtor.org/resort 28 Offer
Not understanding how all the numbers come in to play can be a recipe for failure for both sides of the transaction. 02/21/2020 www.realtor.org/resort 29 Offer
Often listing agents find out too late that they should have had different terms to better protect the seller Waste of time for buyer Buyers agents need to be familiar with the process 02/21/2020 www.realtor.org/resort 30
Offer Strongly suggest inspections and appraisals be done when contract is binding, NOT when bank/investor approves the short sale Repairs the bank/investor will NOT pay for repairs. They dont care. Listing agent diligence up front Bottom line will the contract have a good chance of going to closing 02/21/2020
34 The Co-op Agent 02/21/2020 www.realtor.org/resort 35 Co-op
1. Buyers agent needs to understand why the listing agent may want certain things in the contract 2. Buyers agent needs to be able to relay info to buyer in a way that makes sense 3. The listing agent needs to be able to give logical explanation of why 02/21/2020
www.realtor.org/resort 36 Co-op Dialogue for listing agent DD starts when buyer/seller sign. Bank not party to contract. Bank not party to contract Cant keep seller strung out until bank replies they get closer to foreclosure and can cause
harm to them if buyer decides to walk at any time 02/21/2020 www.realtor.org/resort 37 Co-op Dialogue
Buyer will do inspection on any home they buy. If dont like results theyll walk. No different. Same for appraisal 02/21/2020 www.realtor.org/resort 38
Co-op RE: Appraisal Advantage to have early If not satisfactory will walk. Sooner than later If buyer satisfied with appraisal and investor counters with offer higher than appraisal you have the appraisal to use as what price buyer will pay. Deals have been saved with early appraisal! 02/21/2020
www.realtor.org/resort 39 Appraisal and Bank Counter Appealing bank/investor counter: Know how to appeal Fannie and Freddie 02/21/2020
www.realtor.org/resort 40 Working With Bank Contact 02/21/2020 www.realtor.org/resort
41 Bank Contact Not the enemy job is to close the file Choose your words - ways to say what you want to say. Can make you or break you 02/21/2020
www.realtor.org/resort 42 Bank Contact Schmooze !! Pump them up Some small talk is okay Thank them for helping you, etc., etc.
02/21/2020 www.realtor.org/resort 43 THE APPROVAL LETTER 02/21/2020
www.realtor.org/resort 46 Approval letter VERY IMPORTANT.. Be sure to check the approval letter carefully Look for release of liability for the seller. seller should not be responsible for paying
back the debt to the investor be sure all loan numbers are listed 02/21/2020 www.realtor.org/resort 47 Approval letter VERY IMPORTANT..
Have the closing attorney/title company check and make sure the HUD-1 matches the approval letter. items not on the HUD used for approval will need to be paid by someone deals definitely fall through at this point 02/21/2020 www.realtor.org/resort
48 Approval letter VERY IMPORTANT.. Buyers agent should receive a copy of the approval letter. The buyers lender will need it. 02/21/2020
www.realtor.org/resort 49 Keep in mind There is nothing worse than things falling apart a few days before closing because the numbers on the approval are not what was expected based in the HUD-1 Diligence and proper preparation and planning are key
to a smooth, expedited and successful short sale closing 02/21/2020 www.realtor.org/resort 50 So..
1. Ducks in a row up front from the get go 2. Be sure seller is on same page as you are remember.if timeliness is more important to you than to the seller you will have problems 3. Be smart and have foresight when working on the contract to submit 02/21/2020 www.realtor.org/resort
51 So.. 4. It all needs to make sense to the listing agent so you can clearly explain everything to the co-op agent 5. As a buyers agent you should know what will constitute a strong offer and be able to educate the buyer 02/21/2020
www.realtor.org/resort 52 So.. 6. Be timely in all submissions and do EXACTLY what the processor/negotiator ask of you 7. Know your options if the counter comes back high
8. Relationships throughout the transaction can make a huge difference in the end 8. Engage the closing attorney/title company they have your legal back 02/21/2020 www.realtor.org/resort 53 Dont be afraid to ask questions
Better to ask than to fail because you didnt! 02/21/2020 www.realtor.org/resort 54 Thank you for being part of this webinar! If you have questions I can be reached at
678-414-0760 (direct) Carol Moson, ABR, CRS, e-Pro, SFR, BPOR, GREEN Instructor for REBAC
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