Benefits of Short Sale Out Weigh Risks

Dear Sue,

I have been working for a small engineering firm since graduating from college nearly two years ago. My goal is to own my own home. I talked to a lender that my girl friend referred. Between my savings and my credit I am qualified to buy a $300,000 home.

I have been searching on the internet. I have been finding more short sale properties than foreclosures. It appears as though the foreclosures don’t stay on the market as long as the short sale properties. When I discussed my findings with my real estate agent she said that the short sale properties are hard to close and that I should stay away from them.

Do you agree? Why would she say this?

Short Sale Shorty

Dear Shorty,

You have really done your homework! You must be a very good engineer.

Short sales take a lot of time, energy, patience, tenacity and discipline to negotiate. It takes a special agent to get one to actually close. In fact, according to statistics, only one in three do close.

Many agents stay away from short sales because they don’t want to put themselves and their buyers through the difficult process.

Most lenders are unprepared for the volume of short sales currently taking place in today’s market. Short sale negotiators representing the various lenders are overwhelmed. I sometimes think that they make the process painful just to make the interested parties go away!

I believe that we are seeing more short sale listings because the frustrated agents and their buyers are staying away from them. They would rather wait until the property is foreclosed upon and negotiate directly with the bank.

Real estate agents can now hire professional short sale negotiators. They can be hired to negotiate on behalf of the buyer for a fee. The fee usually comes out of the agent’s commission. There are also many “how to” short sale classes available.

For those agents and buyers willing to take the risk and hang in there with a short sale offer, the price benefit can far out weigh the risk. Successful short sales are generally very good buys. The key is communication and dedication to the process. You must also remember to manage your expectations! Don’t allow yourself to get so frustrated that you drop out of the game early.

Communication and patience in short sale negotiations can be a matter of good Home $$s and Sense.