Short Sales–The No Logic Zone

ILLOGICAL2

If any of you have had the unique experience of being part of a short sale you undoubtedly have discovered that, within that experience, logic has gone pretty much completely out the window. When discussing short sales it’s really a multiple choice illogical experience, so for the purpose of brevity I thought I would just discuss the process of actually seeing one today.

Just in case you haven’t been initiated…a short sale happens when a seller owes more on their home than it’s worth. They then put it on the market, hope to get an offer and if they do they try and negotiate with their lender (or lenders as the case may be) to take less money and let them go. Since lenders are not too crazy about the idea of losing money the seller usually has stopped making their mortgage payments while they try to sell their home short as a way to, hopefully, motivate the lender to work with them. A short sale usually is a little less toxic and damaging to an individuals credit than simply letting the house go to foreclosure. (At least that’s the hope…there’s plenty of negatives about short sales and if you’re contemplating one please discuss your options with an accountant or maybe even an attorney before doing it).

Oh yeah, it’s worth mentioning that a buyer who makes an offer on a short sale can literally wait 6 months or more for a response from the sellers bank. Buying a short sale is an exercise in patience to say the least. You make an offer…and you wait. An agent in my office who has a short sale listing was told upon receipt of an offer that it had to be faxed, and faxed only, to one specific fax machine within that bank. It was constantly busy. When I say that I mean it was busy constantly…for weeks. It was busy when he tried it at 2:00AM. When he called the bank they told him there was no exceptions…they only accepted faxed offers to that one particular machine. Keep trying, he was told. After weeks of this it finally went through…and he had the proof from our machine’s receipt. A week later the bank told him they were missing a couple of pages…send it all again! It took another 3 weeks to get it faxed successfully again.

But I digress…

Back to viewing a short sale. Seems sort of elementary, doesn’t it? Doesn’t it seem logical that an individual who wants to sell their place short may want people to see their place for the purpose of helping them out? No such luck. Here’s some snippets from some actual listings I’ve tried to show in the last few weeks:

*Showing on weekend only: saturdays (2-5pm) and sundays (12-4) call listing agent before showing.

*Dogs on premises. Call listing agent to arrange showing appointment.

*Do Not Disturb Occupants, Restricted Hours, 24-Hour Notice Required, Appointment Only, Call Listing Agent

I think at least half of the short sales I try to show are like this. I’m really not sure I understand why either. Maybe if you’re not making the payment anyway you’ve accepted that foreclosure is inevitable and you just want to live in the house rent free until eviction occurs? Honestly, I really don’t know why it’s like this. Sometimes I see all of these barriers and still see verbage like this:

Buyer just walked, seller needs offer ASAP. Go figure! Yikes!

Comments

  1. Hi Jim,
    What is with this sailfish property…396 Sailfish Isle. It’s huge and still below 1 million?
    It needs TLC…is it TLC or way more than TDR (sorry! I just came up with TDR-tear down and rebuild)

  2. Jim Minkey says:

    It all come down to the fact that the listing agent is from out of the area and missed it on that price. One of my friends in my office had an interested client and was told they have several offers, many with all cash and the price was up to $1.2mil. Offers are due on Friday.

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